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How to utilise mineral wealth to boost India's economic growth

Aarush

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We are fortunate as a nation that we are blessed with abundant natural resources that are available for our development and prosperity. The ultimate objective is to eradicate unemployment and poverty in our country.

Our natural resources can be utilised in the most sustainable manner, with a focus on environment and towards our development. India has the potential to become world's third-largest economy, after the US and China, with increased investments in manufacturing, including in the exploration of our substantial natural resources and higher production in mining and hydrocarbons.

We have clear opportunities to harness natural resources for substantially enhancing India's revenue, leading to not only double-digit growth but to also create millions of new manufacturing-led employment.

The key to this simple revolution lies in a simpler regulatory framework, based on transparent policies and processes, emphasising selfdeclaration and strong deterrents and penalties for non-compliance.

Any ad-hoc decisions like blanket mining bans, output caps and so on are not a step in the right direction and discourage new investments.

India has equivalent or better natural resources and reserves compared to nations like Brazil, Australia, China, Canada and other Latin American nations, but all these countries have moved ahead economically. Today, we have an ever-rising annual import bill of close to $500 billion and, on the other hand, we have a real opportunity to explore, produce and use our substantial reserves and resources, and, therefore, reduce our dependence and expenditure on imports.


Preserving Our Reserves

India is blessed with the world's fourth-largest bauxite deposits, one of the most sought after minerals used for making aluminium. But we have not seen even a single large new bauxite mine in the last 35 years and we are importing bauxite to run domestic aluminium plants.

Investments in gold mines are awaited, even after the Supreme Court's judgment to open up the sector. Today, we are importing 100% of our gold. Copper is a similar story: we are importing Rs 25,000-crore worth of copper every year.

India has iron ore resources at par with Australia and Brazil. Where Australia has doubled its output to 600 million tonnes and Brazil to 400 million tonnes, India's production level remains around 100 million tonnes. On the other hand, through sustainable exploration, China has emerged among the top 10 copper producers and third-largest iron-ore producer. India can substantially enhance its iron-ore output through sustained exploration and mining.

Our natural resources can be auctioned in the most transparent manner, on revenue-sharing basis or on the basis of highest royalty. Our import bill is a matter of great concern.

We produce oil at $4 per barrel and import at $110 per barrel. We are sitting on a large resource base of oil and gas. We need another 20 large companies to enter the sector to unlock our true potential.

We are sitting on the world's fourth-largest deposits of coal, but the concentration of supply through just one state-owned company is hampering thermal power generation, depriving India of energy security.

The government should divest 51% stake in public sector undertakings to the public at large for better governance and accountability. Divestment should be such that no institution or individual can hold more than 10% of equity. The interests of employees too can be better aligned once they have a guarantee about their jobs and stock options to participate in the company's performance.

How to utilise mineral wealth to boost India's economic growth - The Economic Times
 
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We are fortunate as a nation that we are blessed with abundant natural resources that are available for our development and prosperity. The ultimate objective is to eradicate unemployment and poverty in our country.

Our natural resources can be utilised in the most sustainable manner, with a focus on environment and towards our development. India has the potential to become world's third-largest economy, after the US and China, with increased investments in manufacturing, including in the exploration of our substantial natural resources and higher production in mining and hydrocarbons.

We have clear opportunities to harness natural resources for substantially enhancing India's revenue, leading to not only double-digit growth but to also create millions of new manufacturing-led employment.

The key to this simple revolution lies in a simpler regulatory framework, based on transparent policies and processes, emphasising selfdeclaration and strong deterrents and penalties for non-compliance.

Any ad-hoc decisions like blanket mining bans, output caps and so on are not a step in the right direction and discourage new investments.

India has equivalent or better natural resources and reserves compared to nations like Brazil, Australia, China, Canada and other Latin American nations, but all these countries have moved ahead economically. Today, we have an ever-rising annual import bill of close to $500 billion and, on the other hand, we have a real opportunity to explore, produce and use our substantial reserves and resources, and, therefore, reduce our dependence and expenditure on imports.


Preserving Our Reserves

India is blessed with the world's fourth-largest bauxite deposits, one of the most sought after minerals used for making aluminium. But we have not seen even a single large new bauxite mine in the last 35 years and we are importing bauxite to run domestic aluminium plants.

Investments in gold mines are awaited, even after the Supreme Court's judgment to open up the sector. Today, we are importing 100% of our gold. Copper is a similar story: we are importing Rs 25,000-crore worth of copper every year.

India has iron ore resources at par with Australia and Brazil. Where Australia has doubled its output to 600 million tonnes and Brazil to 400 million tonnes, India's production level remains around 100 million tonnes. On the other hand, through sustainable exploration, China has emerged among the top 10 copper producers and third-largest iron-ore producer. India can substantially enhance its iron-ore output through sustained exploration and mining.

Our natural resources can be auctioned in the most transparent manner, on revenue-sharing basis or on the basis of highest royalty. Our import bill is a matter of great concern.

We produce oil at $4 per barrel and import at $110 per barrel. We are sitting on a large resource base of oil and gas. We need another 20 large companies to enter the sector to unlock our true potential.

We are sitting on the world's fourth-largest deposits of coal, but the concentration of supply through just one state-owned company is hampering thermal power generation, depriving India of energy security.

The government should divest 51% stake in public sector undertakings to the public at large for better governance and accountability. Divestment should be such that no institution or individual can hold more than 10% of equity. The interests of employees too can be better aligned once they have a guarantee about their jobs and stock options to participate in the company's performance.

How to utilise mineral wealth to boost India's economic growth - The Economic Times


Nice quote in the signature dude !!!!
 
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