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Indian iron ore mining mess - SC panel calls for strong action in Goa
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Thursday, 29 Nov 2012

Economic Times reported that a Supreme Court committee is likely to recommend drastic action against miners in Goa including severe curbs on production in a move expected to hit the state's finances and devastate the country's scandal plagued iron ore industry.

The Central Empowered Committee which is examining allegations of illegal mining in Goa has indicated to miners and state government officials that curbs on production and restrictions on mining near groundwater sources and wildlife sanctuaries may have to be imposed in the state.

Representatives of the panel warned in a recent closed door meet that the action to root out illegal mining will be painful and a bitter pill not just for the state's miners but also for the heavily ore dependant state economy.

A CEC official in miners and some state government officials in Delhi said that "Let us tell you one thing now itself, it will not be a painless process. And for a certain period of time, mining is bound to remain closed. Status quo cannot be restored in Goa.

CEC said that its recommended path to sustainable mining, as being applied in Karnataka, would substantially reduce Goa's annual 54 million tonne production.

Other likely recommendations include suspension of all environmental clearances within 1 kilometer radius of any wildlife sanctuary in the state and no mining below groundwater, unless supported by strong argument and protective measures against groundwater pollution.

Production in Karnataka, one of the biggest ore producing states in the country was capped at 30 million tonnes last year, severely affecting the financials of companies such as JSW and increasing iron ore prices to a level where companies were forced to cut production.

Mr RV Gumaste MD of Kirloskar Ferrous, which operates its plants at 50% capacity because of the curbs, and has shut down a furnace for maintenance, said that "Without iron ore, what else can we do? We don't have any alternate plan. We are living on hope."

The narrow western coast state, home to Vedanta Group's Sesa Goa and Dempo, Fomento Resources, Chowgule Group and Salgaocars, relies heavily on iron ore mining. Its ore relatively less rich than that of Karnataka, Odisha and Jharkand was being snapped up by hungry Chinese steel mills.

While the current suspension of operations in Goa doesn't add to the woes of the domestic steel industry, it is also pinching the Goan government that gets royalty from the miners.

Source - Economic Times


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