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Iron ore mining closure taking heavy toll on Goa economy

Business Finance

Press Trust of India  |  Panaji 

The closure of iron ore mining in Goa since the last eight months has adversely impacted the state's economy which is facing Rs 1,500-crore revenue loss every month from the sector besides jobs taking a hit, said officials and industry bodies.

The Supreme Court, in its February 7 order, had quashed 88 mining leases, which had to wind up their operations from March 16, bringing the entire industry, a key source of revenue for the government, to a grinding halt.

Goa Minister Sudin Dhavalikar had last week told reporters that revenue to the tune of Rs 1,500 crore is being lost per month due to closure of the mining industry, which has also impacted the livelihood of around 2.5 lakh people.

"The revenue source is shrinking right now due to closure of mining. We are losing around Rs 1,500 crore every month. The resumption of industry is necessary to save the state from facing an economic slowdown," he had said.

The Federation of Indian Minerals Industries (FIMI) fears the economy of the coastal state is staring at downward spiral.

"If you calculate the total impact, almost 25 per cent of the states economy has been impacted due to mining closure.

"In the long run, the economy will continue to unwind and it will have disastrous impact," said Haresh Melwani, FIMI Managing Committee member and a mine owner from Goa, Thursday.

He said Rs 6,000 crore of "fresh money" was being injected monthly into the states economy through exports of iron ore, which has stopped now.

"This was helping the country earn foreign exchange in a big way. The discontinuation of iron ore exports has stopped this money from flowing into the state," he said.

While economic slowdown is one of the concerns, workers are staring at job losses due to the closure of mining operations.

The Goa Mining Peoples Front, a union of mining dependents, has said 4,000-5,000 people, who were employed with various mining firms, have lost their jobs in addition to 6,000 truck drivers.

"Markets in Goa's mining belts are deserted. People are controlling their spendings as they dont know when exactly the industry would resume," said GMPF president Puti Gaonkar.

He warned that if mining operations do not resume soon, there would be catastrophic impact on the state's economy.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

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First Published: Thu, November 29 2018. 18:21 IST