AN OVEVIEW OF

INDIAN
MINING SECTOR
AND
OPPORTUNITIES
INDIAN BUREAU OF
MINES

Importance of mining sector to

National Economy
In 2004-05 the mining and quarrying sector
contributed around 2.8 percent to the total GDP at
current prices.
The overall index of mineral production showed a
positive growth of 4% in 2004-05 over 2003-04.
The total value of mineral production in public sector
was RS. 55,972 crore (75%) and private sector was Rs.
19,046 crore (25%).

Importance of mining sector to

National Economy
3168 working mines (excluding atomic, minor
minerals and petroleum & natural gas) located in 22
states. Among them, 562 coal & lignite, 615 metallic
and 1991 non-metallic minerals.
Public sector shares 790 mines while 2378 mines
belong to private sector.
The estimated average daily employment of labour
engaged in mining sector was 5,56,647 in 2004-05. Of
this, 85% was contributed in public sector and
remaining private sector.

An Overview
India is endowed with substantial

mineral resources.
Mining sector is an important segment
of the Indian economy.
India produces as many as 90 minerals
4 fuels
10 metallic
50 non-metallic
3 atomic and
23 minor minerals (building and other
materials).

Indian Mineral Sector :

Fiscal Overview
The

value of Mineral Production in 2004-05

was Rs. 75,018 crore.
The export of minerals and metals was of
the order of Rs.1,04,443 crore in 2004-05.
The total import value of minerals and
metals was of the order of Rs.2,58,211 crore
during 2004-05.
Therefore, the country is net importer of
minerals & metals.

An overview
At the time of independence the inventory of

mineral resources was available only for a few

important minerals like
*Coal, *Chromite, *Manganese ore, *Bauxite,
*Sillimanite, *Magnetite and *Gypsum.
Immediately after independence and consequent to
adoption of Industrial Policy Resolution 1956, the
pace of mineral exploration accelerated.
(Contd.)

An overview
The post-independence era witnessed a massive
expansion of exploration activities, which helped in
augmentation of mineral inventory.
Today the country can boast of having inventory
of 64 minerals excluding fuels and atomic minerals.

India vis-a-vis World Resources

Mineral

Asbestos

World All
% to World
(in MT) India
(in MT)
Large

18.45

Barytes

740

80.05

10.8

Bauxite

33000

2925

8.9

1800

179

9.94

984.453

247.85

25.17

Chromite
Coal &
Lignite (Billion
Tonnes)

Contd.

India vis-a-vis World Resources

(Concld.)

Mineral

World All
% to
India
World
(in
MT)
(in MT)

Iron ore

370000

22108

5.98

Limestone

Large

170458

Manganese ore

5100

295

5.78

Magnesite

3600

369

10.25

50000

289

0.58

Phosphate rock

MINERAL PRODUCTION
ii. VALUE OF MINERAL PRODUCTION
(2004-05) - Rs. 75,018 Crores
(Excluding atomic minerals)

Fuel Minerals
Rs. 57,228
crores
Metallic minerals Rs. 8,194
crores
Non-metallic
minerals
Rs. 2,462
crores

INDIAN PRODUCTION OF IMPORTANT MINERALS

DURING 2004-05
(IN MILLION TONNES)

MINERALS

INDIAN
PRODUCTIO
N

BARYTES

1.16

BAUXITE

11.7

CHROMITE

3.6

COAL &LIGNITE

412

IRON ORE

142.7

LIMESTONE

161.46

MAGNESITE

0.38

MANGANESE ORE

2.38

MICA (SHEET)
OOOTONNES

1.37

ROCK PHOSPHATE

1.18

(PHOSPHORITE)

TALC/STEATITE

0.75

WOLLASTONITE

0.17

FOREIGN TRADE ON MINERALS

(2004-05)
i.

(Value in Crores)
EXPORTS (Provisional)
All merchandise : Rs. 357,077
(a) Value of exports of
Rs. 69,342
ores & minerals
(b) Value of exports of
Rs. 35,101
metals & alloys
Total
Rs. 104,443
Contd

IMPORTANT ORES & MINERALS EXPORTED

(Value in
Crores)
. Diamond (cut & polished)
- Rs. 46,557
. Iron Ore
- Rs. 13,950
. Granite
- Rs. 2,562
. Alumina
- Rs. 1,247
. Chromite
- Rs. 798
. Precious & semi-precious
- Rs. 754
stones

Concld.
IMPORTANT ORES & MINERALS EXPORTED

.
.
.
.
.
.

(Value in Crores)
Emerald (uncut & cut)
- Rs. 306
Zinc ores & Conc.
- Rs. 274
Marble
- Rs. 212
Bauxite
- Rs. 134
Mica
- Rs. 88
Manganese ore
- Rs. 70

FOREIGN TRADE ON MINERALS

(2004-05)
(Value in
Crores)
ii.
IMPORTS (Provisional)
All merchandise
476,201
(a) Value of imports of
182,710
ores & minerals
(b) Value of imports of
metals & alloys
Total

: Rs.
Rs.

Rs. 75,501
Rs. 258,211

IMPORTANT ORES & MINERALS

IMPORTED
(In
Crores)
Petroleum crude
118,932
Diamond (uncut)
41,791
Coal
Coke
Copper ores & concentrates
3,146
Natural gas

- Rs.
- Rs.
- Rs. 9,141
- Rs. 3,725
- Rs.
- Rs.

Concld.

IMPORTANT ORES & MINERALS IMPORTED

Rock Phosphate
987
Sulphur
Precious & semi-precious
stones
Asbestos

(In Crores)
- Rs.
- Rs. 483
- Rs. 382
- Rs. 264

Mineral Production
Value of Mineral Production in 2004-05 was

of the order of Rs. 75,018 Crore

Fuel minerals constitute

76%

Metallic minerals

11%

Non-metallic minerals
Minor minerals

3%
10%

Important Mineral Production:

Mineral

India vis-a-vis World

World

(in MT)

Barytes

1.16

18.4

155.0

11.70

7.0

Chromite

16.4

3.6

22

Coal & Lignite

5080

412

8.1

Copper Metal

13.6

0.4

2.94

Diamond(Million
Carats)

150

0.078

0.05

Iron ore

1238

143

11.5

Manganese ore

24.3

2.38

9.8

Magnesite

20.8

0.38

1.82

Bauxite

6.3

All India % to
World
(in MT)

Indian Mineral Resource Position

Abundantly available Minerals

Asbestos
(except
chrysotile)

Barytes,

Bauxite,

Chromite
Felspar
Iron ore

Dolomite
Gypsum
Ilmenite & Rutile

Fireclay
Kaolin
Limestone &
other
Calcareous
materials
(Contd.)

Indian Mineral Resource Position

Abundantly available Minerals (Concld.)

Bentonite

Coal & Lignite

(except coking
coal)

Granite

Manganese
Ore

Marble, Slate,&
Mica
Other Dimensional
Stones

Ochre

Talc/Steatite/Soap Pyrophyllite
stone
and Quartz &
Silica Minerals

Indian Mineral Resource Position

Adequately available Minerals
Calcite
Fullers earth
Graphite
Magnesite

Indian Mineral Resource Position

Deficiently available Minerals
Apatite & Rock Cobalt
phosphate

Copper

Diamond &
Gemstones

Fluorspar

Gold

Kyanite
Rare earths

Sillimanite
Lead & Zinc
Sulphur & Pyrites Vermiculite

Perlite

Wollastonite

Zircon

Indian Mineral Resource Position

Scarce available Minerals
Antimony
Diatomite
Nickel

Boron
Molybdenum
Petroleum
(crude)

Cadmium
Platinum
Natural gas

Potash
Tin

Selenium
Tungsten

Tellurium
Vanadium

Dismantlin
g State
Monopoly

Welcomin
g Private
Investmen
t

Streamlini
ng
Regulation
Decentralizati
s
Promotion
Harmonizati on of
Authority
of Foreign
on with
Investmen
Global
t
Norms

RESPONSE TO THE INVESTOR FRIENDLY

MEASURES
73 Applications for Foreign Direct Investment
worth Rs.4,044 Crore (US $ 830 Million)
approved.
Prior to December 1999, 65 proposals for
aerial prospecting over an area of 90,000 Sq.
Km granted.
Till December 2005, 203 Reconnaissance
Permits over an area of 278,618 Sq. Km
granted.

NEW GUIDELINES FOR FOREIGN

DIRECT INVESTMENT
For all minerals foreign equity
holding upto 100% will be allowed
on automatic route for both
exploration and mining.

ACTIVITYWISE FIPB APPROVALS

(AS ON 01.07.2005)

S. Activity
No
.

No. of
Equity
Approval
(In Rs.
s
Crores)

1.

38

2318.60

05
29
01

133.93
1591.46
0.03

73

4044.02

2.
3.
4.

Exploration /
Prospecting
Mining
Processing
Mining
Machinery
TOTAL

RESOURCE SCENARIO OF
SELECTED MINERALS
BARYTES
BAUXITE
CHROMITE
COPPER
DIAMOND
DOLOMITE
GRAPHITE
IRON ORE
LIMESTONE
LEAD & ZINC
MANGANESE ORE

ALL INDIA RESOURCE POSITION

Mineral
Total
Leasehold
Freehold
No. of
Deposit
s

Resourc
es

No. of Resource No. of

Deposit
s
Deposi
s
t

Barytes

248

80 M.T.

96

49 M.T.

152

31 M.T.

Bauxite

787

2926
M.T.

273

607
M.T.

514

2319
M.T.

Chromit
e

94

179
M.T.

36

133
M.T.

58

46
M.T.

Copper

232

1338
M.T.

18

615 M.T.

214

723 M.T.

Diamon
d

50

4.5

1.2
(Million
Carats)

47

3.3

Dolomit
e

616

2082
M.T.

214

(Million
Carats)

7084
M.T.

402

Resourc
es

(Million
Carats)

5002
M.T.

ALL INDIA RESOURCE POSITION

Total

Mineral

Leasehold

No. of Resource No. of

Deposit
s
Deposit
s
s

Freehold

Resourc
es

No. of
Deposi
t

Resourc
es

Graphite

339

1,59 M.T.

171

689.T.

168

152 M.T.

Iron Ore

821

11,426
M.T.

532

7489
M.T.

289

3937
M.T.

130

10682
M.T.

28

575
M.T.

102

10,107
M.T.

2856

1,70,459
M.T.

1520

19,910
M.T.

1336

1,50,549
M.T.

Lead &
Zinc

121

485 M.T.

14

152 M.T.

107

332 M.T.

Manganes
e Ore

579

295
M.T.

373

234
M.T.

206

61
M.T.

(Haematite)

Iron Ore
(Magnetite)

Lime
stone

DEMAND-SUPPLY POSITION OF
IMPORTANT MINERALS
ASBESTOS
The present level of production is around 5600 tonnes.
Though the resources are limited, occurrences are
widespread.
However, no new leases for asbestos are granted
considering the hazardous and occupational health problems.
By 2006-07 more than 0.135 million tonnes of asbestos
will be required where as the present level of production is
around 5600 tonnes which is dwindling year by year.
Therefore, the country has to depend on import source.
Contd

DEMAND-SUPPLY POSITION OF
IMPORTANT MINERALS

BAUXITE
The present level of production is 11.70 million tonnes.
Small deposits with less than 50 million tonnes can be
earmarked for brown field expansion of existing refineries.
Large deposits may be earmarked for future green field
projects.
The Gandhamardan bauxite deposit of Orissa can be planned
for development.
R &D efforts to utilize inferior grade bauxite of Gujarat and
Chhattisgarh.
Contd

DEMAND-SUPPLY POSITION OF
IMPORTANT MINERALS

CHROMITE

The present level of production is 3.63 million tonnes.

The chromite pits in Sukinda ultramafic belt and BaulaNausahi belt in Orissa are getting deepened with the
advancement of operation.
Mining by opencast methods is economically not possible
and feasible beyond the depth of 100 m. All the major
workings in Orissa are reaching this level.
To have viable and effective underground mining operations,
a state-of-the-art mining method has to be evolved backed by
sound geo-technical studies in the backdrop of friable nature of
ore and overburden.
Contd

DEMAND-SUPPLY POSITION OF
IMPORTANT MINERALS

COPPER
The present level of production is 2.93 million tonnes of
copper ore equivalent to about 29 thousand tonnes of copper
metal.
By the year 2010-11, the country may need more than 1.0
million tonnes of copper metal.
Presently only 289 million tonnes of copper ore equivalent
to about 3.00 million tonnes of metal falls under Reserve
category.
Most of the deposits in the country are exploited to
economical depth and there is need to develop suitable mining
methods to exploit deep seated deposits.
Contd

DEMAND-SUPPLY POSITION OF
IMPORTANT MINERALS

GOLD

The present level of production is 3.5 tonnes of primary gold.

Although more than 30 % of the worlds gold is consumed in
India, its production meets less than one percent from its
domestic sources.
In the recent past geological occurrences of gold have been
reported from various locations like Bhukia in Banswara dist. in
Rajashtan, Parasi in Ranchi Dist., Jharakhand etc.
India may embark upon extensive exploration of gold in
known, as well as new virgin areas.
Further there is scope for improvement in processing
technology for recovery of gold.
Contd

DEMAND-SUPPLY POSITION OF
IMPORTANT MINERALS

IRON ORE
The present level of production is 143 million tonnes with
58 million tonnes of lumps
80 million tonnes of fines &
5 million tonnes of concentrates.
About 55-60% of the total production is generated as Iron
Ore Fines.
The per capita consumption of Steel in India is 29 Kg only
as compared to world average of 150 Kg.
Contd...

DEMAND-SUPPLY POSITION OF
IMPORTANT MINERALS

IRON ORE

(Concld.)

The National Steel Policy has envisaged the production of

100 million tonnes of Steel by 2020. To achieve this goal the
iron ore mining has to come up in a big way to cater the need of
iron ore.
The closure of mining operations at Kudremukh project is
of concern as it may jeopardize the export prospects.
There is need to augment the production of existing mines
and to open up new deposits to achieve the targets.
Contd...

DEMAND-SUPPLY POSITION OF
IMPORTANT MINERALS

LEAD
The present level of production is 81,635 tonnes of concentrate.
The per capita consumption of lead is at 0.10 Kg as against the
developed countries average of about 5 Kg.
Around 51 scrap-based secondary lead producers in the
organized sector were set up with a total capacity of 45,000tpa.
Government of India has made mandatory that all the battery
manufacturers should sell a battery only against a used battery of
the same type.
All used batteries thus collected would help the secondary units
in the organized sector in getting battery scrap.
Contd

DEMAND-SUPPLY POSITION OF
IMPORTANT MINERALS

MANGANESE
The present level of production is 2.38 million tonnes.
The envisaged production of Steel will also prove better
prospects for manganese ore industry too.
Intensive exploration to convert quantities in resources
category to reserve category by detailed exploration and
feasibility studies is necessary.
Efforts are necessary for steeping up R&D activity in
order to develop commercially feasible techniques for
beneficiation of low grade manganese ore and agglomeration
of fines.
Contd

DEMAND-SUPPLY POSITION OF
IMPORTANT MINERALS

DIAMOND
The present level of production is 78,315 carats.
India is the largest cutting and polishing center of diamond
and export of diamond in the value added form.
Currently Indian diamond industry has a share of 55 % in
terms of value and 85 % in terms of cartage.
However, the Indian diamond industry is largely depend
on imported rough diamonds.
So far, exploration carried out over a period of time has not
resulted in significant discoveries. Therefore, intensive search
is required for search of diamond bearing rocks.
Contd

DEMAND-SUPPLY POSITION OF
IMPORTANT MINERALS

LIMESTONE
The present level of production is 161.46 million tonnes.
Only 7% of limestone resources of the country is under
reserve category. Considering the projected growth it is likely to
be exhausted in the next 70 years
The hilly States like Himachal Pradesh, Jammu & Kashmir
and North-eastern States have enough reserves of high-grade
limestone where eco-friendly mining methods can developed..

Contd

DEMAND-SUPPLY POSITION OF
IMPORTANT MINERALS

LIMESTONE

(Concld.)

The major requirement of low silica limestone for steel making

continues to be imported.
Indigenous supply of low silica limestone for steel making is
expected to be met from Rajasthan, Himachal Pradesh and Uttar
Pradesh. Therefore, there is need to develop these deposits.
Contd

Future Direction
TECHNOLOGY DEVELOPMENT
India

is essentially a country of small scale mining, since as

much as 87% operations can be considered as small scale.
As the sizes of the mines are getting larger and larger, costeffective handling of large volume of minerals on a
continuous basis from mine-face to dispatch point is becoming
increasingly important.
The trend for adopting modern continuous system of
crushing and conveying minerals in the mines, opens up
significant business opportunities for the manufacture of such
systems.

Future Direction
INFRASTRUCTURE DEVELOPMENT
Most of the mineral deposits occur in inaccessible
locations making their exploitation difficult.
The existing roads, rail and ports facilities in the country
are inadequate to handle the already opened up mineral
deposits.
Therefore, the need of the hour is to augment the existing
infrastructure facilities as well as create additional
capacities.

Future Direction
PROTECTION OF ENVIRONMENT
Concern for environmental preservation and its
improvement has special significance in a country like India
which sustains as much as 16% of worlds population on
nearly 2.5% of land mass.
There has been increasing trend that mining companies
are obtaining the international standards like ISO 14000
which will be a benchmark in mining environmental
scenario.
In future the concept of Self regulation for environment
will emerge.

Conclusions
India

is poised for a developed nation status in the

near future, lot of industrial and infrastructure growth
is expected.
Therefore, increase in production is inevitable in
respect of important minerals.
Recently Planning Commission has constituted a
high level Committee to review the National Mineral
Policy and recommend possible amendments to the
Mines and Minerals (Development and Regulation)
Act, 1957 to give further fillip to private investment
in the mining sector.

Conclusions
The vision statement 2020 prepared by the Ministry
of Mines, Government of India states that
to promote and facilitate rapid and sustainable
development of national mineral sector, continuing
with efforts for enhancing mineral inventory by
intensive search for new mineral findings and
regulating mines and minerals giving stress for
conservation and utilization of waste and low grade
resources by technology development
goes further to amplify the intent of our mineral
policy.