More than 260,000 people in danger of losing jobs over lapsing mines

More than 260,000 people are in danger of losing their jobs, direct and indirect, because of the lapsing of merchant mines by March next year. 

This comes when the country is in the throes of its worst employment crisis in more than 40 years.

According to the National Sample Survey Organisation (NSSO) data, the unemployment rate rose from 2.2 per cent in 2011-12 to 6.1 per cent in 2017-18 with the workforce shrinking by 47 million. 

The labour force participation rate during this period dipped from 55.9 per cent to 49.8 per cent.

The validity of 329 mining leases will cease by March 31, causing job losses for 264,000. On the list of the lapsing mines are 48 operative leases, whose shutdown will lead to a deficit of around 60 million tonnes (mt) in raw material supplies, mainly iron ore. 

As a fallout of the Supreme Court’s orders on mining in Odisha, Jharkhand, Goa, and Karnataka, 200,000 people directly engaged in mining have lost their livelihood. 

The orders also meant that the livelihoods of 10 times the pool of the direct employed were affected. While an order passed by the Supreme Court brought mining in Goa to a halt, other pronouncements have crippled the pace of mining in Karnataka, Odisha, and Jharkhand. 

“Given the present unemployment crisis in the country, it is believed that employment-intensive growth is the key to utilising India’s demographic dividend and ensuring a remarkable growth story. If managed effectively, the mining sector with 0.52 employment elasticity can generate around 13 times more employment than the agriculture sector and six times more employment than the manufacturing sector for every 1 per cent increase in the sector’s GDP, pointing towards the relatively high employment generation ability of the sector,” said R K Sharma, secretary general of the Federation of Indian Mineral Industries (Fimi).

The country's mining sector (excluding petroleum and natural gas) directly employed 2.32 million in 2012 and sustain the livelihoods of 23 million. If backed by favourable government intervention, the mining sector has the potential to spawn direct and indirect jobs for 50 million people by 2025, Fimi has estimated.

“Due to a mix of lopsided policies and poor policy implementation, India’s mining industry is in a chaos. In the past decade, many mines have been closed down or suspended due to judicial intervention,” said a mining industry source.

Mining is next only to construction, finance and real estate in generating job per unit increase in sectoral gross domestic product (GDP).

According to the erstwhile Planning Commission's 12th Five-Year Plan (2012-17), the mining sector boasts an employment elasticity of 0.52 per cent, far exceeding 0.04 per cent for agriculture and 0.09 per cent for manufacturing. For every 1 per cent hike in economic growth, the mining sector creates 13 times more employment than agriculture and beats the manufacturing sector six times over in job creation.