Get your act together to boost mining: PlanComm to ministries

The Commission thinks the sector can garner $30 bn and help reduce the current account deficit

In view of falling mining output, the Planning Commission today asked ministries concerned to get their act together to boost mineral production as the sector can garner $30 billion and help reduce the current account deficit.

The Commission reviewed the performance of the mining sector in a high-level meeting, chaired by Planning Minister Rajeev Shukla. Top officials from ministries concerned attended the meeting. "We discussed issues related to the mining sector and asked ministries concerned to get their act together to improve the production," Shukla told reporters after the meeting.

"The Commission has asked them to do the needful to remove the impediments to the mining sector as it could help garner over $30 billion and bridge the current account deficit," he added. Current account deficit (CAD) is the difference between inflow and outflow of foreign exchange. In the 2012-13, CAD was at all-time high of 4.8% of GDP or $88.2 billion.

The government had proposed to bring it down to $70 billion or 3.8% of the GDP this year. It is now pegging the deficit at around USD 60 billion in 2013-14. Representatives of ministries of environment & forest, and mines attended the meeting.

Also, representatives of the Department of Land Resources under the Ministry of Rural Development, the Archaeological Survey of India, the Atomic Energy Commission participated in the meeting. The Federation of Indian Mineral Industries (FEMI) also made a presentation on issues being faced by the sector.

Shukla said there are over 65,000 mining applications pending with state governments, including Odisha, Rajasthan, Chhattisgarh, Maharashtra, Karnataka and Haryana. According to government's latest industrial production data, mining output contracted by 3.4% in April-August period compared to a dip of 1.8% in the same period in 2012-13. In August, the mining production contracted by 0.2% compared to a decline of 0.3%t in the same month of last year.

The decline in production is mainly attributed to the ban on mining in the mineral-rich states of Karnataka and Goa. The ban in Karnataka was partially lifted in April this year, while Goa miners hope the ban would be lifted soon.

According to national accounts data, the mining and quarrying output is projected to come down to Rs 25,568 crore at factor cost (2004-05 prices) in value terms this fiscal from Rs 26,302 crore in 2012-13. The minister said, "If need be, we will call states to discuss the issues related to mining for boosting the output."