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Mining ban affecting economy: Sharma

New Delhi, Dec 26, 2013, PTI:
Ban on mining by the Supreme Court has hit the economy and exports besides increasing India's dependence on imported coal. PTI file photo

Ban on mining by the Supreme Court has hit the economy and exports besides increasing India’s dependence on imported coal.

“It (mining ban) has hurt our economy. It has hurt exports, (particularly) iron ore exports. It has increased our dependence on coal imports. So both ways we are loosers,” Commerce and Industry Minister Anand Sharma said.

But for the ban on mining, he said, India could have earned by exporting around 100 million tonnes of iron ore.

“We have been deprived of the precious foreign exchange and what we could have mined in India. When it comes to coal, USD 22 billion plus was the coal import bill,” the minister said adding: “these are the areas which need a serious look.”


The Supreme Court had banned iron ore mining in Karnataka in July-August 2011 and in Goa in October 2012.

Earlier, Sharma has raised concerns over judicial activism and said: “India badly needs judicial reforms”.

Following the ban, shipments of iron ore plunged to 18 million tonnes in 2012-13 from nearly 168 million tonnes in 2010-11. Before the ban, India was exporting iron ore worth over $7 billion.

Environmental restrictions have significantly hampered coal production in the country, leading to increase in dependence on coal imports.

Slow down in exports have increased the trade deficit as well as the current account deficit. While the trade deficit soared to a record high of $191 billion in 2012-13, CAD jumped to $88.2 billion, or 4.8 per cent of the GDP during the period.

The mining sector, with a weight of about 14 per cent in Index of Industrial Production (IIP), saw a contraction of 3.5 per cent in October as against a dip of 0.2 per cent in the same month last fiscal.

During April-October, the output shrank by 2.7 per cent as against a contraction of 1 per cent. Coal production, with a weight of about 4.5 per cent in the IIP, declined by 3.9 per cent in October.

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