Writing On The Wall
While issuing sanction letters to the first 100 mining affected truck owners recently, Chief Minister Manohar Parrikar asked the mining dependent to reduce their dependence on mining and seek alternative modes of livelihood, including in agriculture and dairy farming. It was a telling comment.
Though the State government says it is hoping to get what it terms “legal” mining started by the end of this year with the Supreme Court’s sanction, the subtle shift in perspective has not gone unnoticed. From all indications it would seem iron ore exports are a sunset industry. The Federation of Indian Mineral Industries pointed out recently that ferrous exports were down 68.2 per cent in the April-January period of the last fiscal to a mere 16 million tonnes and was not expected to cross 20 million tonnes in the last financial year that ended March 31, 2013.
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Goa itself delivered 40 per cent of India’s total ore exports. The steel sector in India, with infinitely more clout, has been pressing for an outright ban on ore exports from India after international prices climbed to $140 a tonne. While the Central authorities desisted from agreeing to a total ban on exports, over the past few years barrier after barrier has been thrown at the ore export trade ~ freight charges have been upped and export duties have climbed from 5 per cent to 30 per cent currently.
While the steel sector, that relies on ore as raw material, was far more worried about the export of high grade ore going out of India from states like Karnataka and Odisha, Goa’s own claim of exporting low grade ore that the domestic steel sector has yet to find full use for has been swept aside in the politics and economics of the situation.
Not long ago, Goa was prepping its own mining policy to work its dumps and export “rejects” at the high current prices and feed the demand for low grade ore in the international market which is not expected to last too long. The Centre-State impasse, the Shah Commission report and the Supreme Court ban has put paid to that and has brought about a reality check, it would seem. Clearly Goa can never go back to the times of unregulated exports of 54 million tonnes it hit at its peak.
Even half that amount seems highly unlikely in the future, as India’s ore exports plummet this year. With the industry bottoming out, can subsidies be the answer?
In mining villages, the more pragmatic have already returned to agriculture, much before the CM gave that advice recently. All the backward and forward links to the ore export industry enjoyed windfall profits in the decade-long boom. Certainly, returns on investment in any other sector, let alone agriculture, may not be half as lucrative. But dream runs end. Stoking angst is hardly the solution for governance.
The silence on the mining front, it was admitted by the government earlier this week in the State Assembly, has brought down road fatalities in those areas drastically. In terms of Goa’s gross domestic product, the primary sector that includes mining, fishing, agriculture and forestry accounts for 9.70 per cent of the GSDP only, and registered a negative growth rate of 6.43 per cent in the past couple of years, since issues over illegal mining clamps came into place. The vagaries of demand and supply, and economic pulls and pressures, are written into any trade. To pretend otherwise would be folly, and to ignore the writing on the wall, even more so.
