National Mineral Policy 2006 - Department of Mines
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National Mineral Policy 2006 - Department of Mines

National Mineral Policy 2006 - Department of Mines National Mineral Policy 2006 - Department of Mines

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12.07.2015 Views

Appendix ERecommendations of the Expert Group on National Guidelines for Mining Leases—Iron, Manganese, and Chrome Ores, Headed by Shri R. K. Dang 2Rationale for Preferences1. In pursuit of the national goal of rapid industrialization, creation of wealth,enhancement of living standards and achieving economic strength in keeping with India’ssize and population, optimum utilization of the country's natural resources is ofunquestionable importance. Steel is still the most important and critical requirement in thedevelopment of infrastructure, industry and manufacturing; even though progressive inroadsare being made by substitutes like Aluminium, Plastic and Ceramics. Production of steelcommensurate with our geographical size, population and developmental goals has to begiven highest strategic priority. The present per capita consumption of 31 kgs has to increaseto at least 80 kgs by 2020 and perhaps 300 kgs by 2050, as against present world average of150 kgs and US consumption of 350 kgs.2. For production of steel by conventional Blast Furnace process, the production ofcoking coal in India is much below requirements. India is also faced with the dauntingprospect of inadequate petroleum reserves and escalating world prices. For various reasons,the cost of energy and capital in India are much higher than in some other steel producingcountries. India is, however, endowed with rich resources of iron ore of high quality. This isone of our major strengths for globally competitive production of steel. Every care has to betaken in the national interest to preserve and leverage to the maximum this natural advantageby rapidly building up a strong world class steel industry as the bedrock for industrializationand manufacturing, paralleling the rapid expansion and success of the service sector insoftware and BPO outsourcing.3. During 2004–05, 78 million tonnes of iron ore was exported (70% to China) earning $4 billion or thereabouts. Export of its steel equivalent of 50 million tonnes would have earned$ 20–25 billion. Total Indian exports in 2004–05 are estimated at $ 79.2 billion and our net2 ‘Report of the Expert Group on Preferential Grant of Mining Leases for Iron Ore, Chrome Ore and ManganeseOre’, constituted by Government of India, Ministry of Steel, August 2005.238

import of POL [petrol, oil, and lubricants] at around $ 21 billion. During the last 3 decades,cumulative exports of iron ore were over 1 billion tonnes of mostly high grade ore for a totalearning of perhaps $ 30 billion.4. The country’s natural advantage of rich iron ore reserves must not be frittered awayby continued positioning as a raw material supplier to the developed world and now, even torapidly industrialising China. Nothing should be allowed to shift focus from or delay ourattaining our rightful place as a major producer of steel and manufacturing in keeping withour size, population and resources. With growing industrialization and manufactures,production of steel and downstream products is clearly at a take-off point. Our iron orereserves of all grades need to be channelised into steel production, with exports of iron ore asecondary activity, diminishing in inverse proportion to increasing steel production andconsumption.5. The entire exercise undertaken by the Expert Group as well as formulation ofguidelines for the SCHEME OF PREFERENCES in the matter of grant of leases, and otherobservations and recommendations are customized to this strategy.6. Any departure from the principles of natural justice and first-come-first-served, asenshrined, inter alia, in the MMDR Act, has to be based on larger public interest and inconsonance with, though not limited, to the matters specified in Section 11(3)(a) to (d) of theAct, by making use of specific provisions contained in Section 11(3)(e) ‘such other matters asmay be prescribed’.7. The SCHEME OF PREFERENCES recommended, hereinafter, is designed to makeconcrete elaboration in terms of Section 11(3)(e) specific to the rapid and orderly growth ofthe steel industry and limited to the three ferrous mineral, i.e. iron ore, manganese ore andchrome ore which are critical inputs.Basis for Preferences8. The proposed SCHEME OF PREFERENCES is designed to sub-serve thefollowing main objectives:-239

Appendix ERecommendations <strong>of</strong> the Expert Group on <strong>National</strong> Guidelines for Mining Leases—Iron, Manganese, and Chrome Ores, Headed by Shri R. K. Dang 2Rationale for Preferences1. In pursuit <strong>of</strong> the national goal <strong>of</strong> rapid industrialization, creation <strong>of</strong> wealth,enhancement <strong>of</strong> living standards and achieving economic strength in keeping with India’ssize and population, optimum utilization <strong>of</strong> the country's natural resources is <strong>of</strong>unquestionable importance. Steel is still the most important and critical requirement in thedevelopment <strong>of</strong> infrastructure, industry and manufacturing; even though progressive inroadsare being made by substitutes like Aluminium, Plastic and Ceramics. Production <strong>of</strong> steelcommensurate with our geographical size, population and developmental goals has to begiven highest strategic priority. The present per capita consumption <strong>of</strong> 31 kgs has to increaseto at least 80 kgs by 2020 and perhaps 300 kgs by 2050, as against present world average <strong>of</strong>150 kgs and US consumption <strong>of</strong> 350 kgs.2. For production <strong>of</strong> steel by conventional Blast Furnace process, the production <strong>of</strong>coking coal in India is much below requirements. India is also faced with the dauntingprospect <strong>of</strong> inadequate petroleum reserves and escalating world prices. For various reasons,the cost <strong>of</strong> energy and capital in India are much higher than in some other steel producingcountries. India is, however, endowed with rich resources <strong>of</strong> iron ore <strong>of</strong> high quality. This isone <strong>of</strong> our major strengths for globally competitive production <strong>of</strong> steel. Every care has to betaken in the national interest to preserve and leverage to the maximum this natural advantageby rapidly building up a strong world class steel industry as the bedrock for industrializationand manufacturing, paralleling the rapid expansion and success <strong>of</strong> the service sector ins<strong>of</strong>tware and BPO outsourcing.3. During 2004–05, 78 million tonnes <strong>of</strong> iron ore was exported (70% to China) earning $4 billion or thereabouts. Export <strong>of</strong> its steel equivalent <strong>of</strong> 50 million tonnes would have earned$ 20–25 billion. Total Indian exports in 2004–05 are estimated at $ 79.2 billion and our net2 ‘Report <strong>of</strong> the Expert Group on Preferential Grant <strong>of</strong> Mining Leases for Iron Ore, Chrome Ore and ManganeseOre’, constituted by Government <strong>of</strong> India, Ministry <strong>of</strong> Steel, August 2005.238

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