Metals and Mining Industry in India:
The primary metals industry, which includes ferrous and non-ferrous mining and processing, contributed $52.7 billion to India’s GDP, accounting for 8.1 percent of the entire manufacturing sector. Metals and Mining Industry in India performs quite well within Asia as a whole, despite being substantially smaller than its neighbour China, which had a share of 29 percent (excluding Japan). Iron ore production was anticipated to be 2.3 billion tonnes in 2015, while coal production was estimated to be 596 million tonnes.
Although public sector businesses generate the majority of Indian steel, few private companies make specialised steels for high-end uses. Bauxite, chromite, copper, iron ore, manganese, and zinc reserves in India are among the world’s greatest.
Iron ore accounts for approximately 65 percent of all mineral production in India, with limestone (16 percent), crude oil (10 percent), coal (8 percent), and gold accounting for the remaining ten percent (5 percent). A major portion of India’s mineral riches is hidden beneath forest lands, which require environmental approval before mining can commence.
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India is regarded as a major producer of a variety of commodities, including aluminium, asbestos, diamonds, graphite, gypsum, lead, and zinc. Silver and titanium sponge are also produced in large quantities. Barites, cement stone, copper ore, dolomite, feldspar, garnet sandstone, and quartz are among the other minerals mined.
Coal India Limited (CIL), National Mineral Development Corporation Limited (NMDC), Hindustan Copper Limited, and Neyveli Lignite Corporation Limited are just a few of the significant mines in India. CIL and NMDC have been given special status as Navratna enterprises, equivalent to PSUs like as ONGC and SAIL.
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Future Exploration:
Steel
- India is the world’s second-largest crude steel producer, with 104.91 million tonnes produced during January to November 2021.
- Total Finished Steel production reached 111.858 MT, up 21.3 percent from the previous year.
- During FY’22, India exported 13.5 MT of finished steel worth INR one lakh crores.
- Actual crude steel production is expected to reach 255 MT between 2030 and 31.
- By 2030-31, per capita finished steel consumption is predicted to reach 160 kg (from 72.3 kg in 2021).
- Steel production grew by 9.3 percent in July 2021 over July 2020 (weight: 17.92%).
- Demand for stainless steel in the United States is predicted to exceed 20 MT by 2047.
- During the fiscal year 2021, India produced 120 million tonnes (MT) of crude steel.
Coal
- India has 1,303 mines that reported mineral production (excluding atomic, fuel, and minor minerals) in 2019-20, producing 95 minerals: four fuel-related minerals, ten metallic minerals, 23 non-metallic minerals, three atomic minerals, and 55 minor minerals.
- India is the world’s second-largest coal producer, with total coal production of 716.08 MT in 2020-21.
- In December 2021, India’s total coal production climbed by 6.74 percent to 74.78 MT, compared to the same period in 2019.
- In 2040, coal is expected to be India’s greatest single source of electricity.
- Coal India Limited (CIL) dispatched 75.05 MT of coal in December 2021, up 14.62 percent from 65.48 MT in December 2019.
The country’s FDI Policy for the Metals and Mining Industry in India allows: 100% FDI through automatic route in the steel sector.
Industry Scenario of Metals and Mining Industry in India:
With the publication of the National Mineral Policy 2019 and the Mines and Minerals (Development and Regulation) Amendment Act 2021, India presents a significant potential for metal sector investors.
Iron ore, bauxite, chromium, manganese ore, baryte, rare earths, and mineral salts are all abundant in India. Due to reforms such as the Make in India Campaign, Smart Cities, Rural Electrification, and a focus on building renewable energy projects under the National Electricity Policy, as well as increased infrastructure development, Metals and Mining Industry in India is expected to undergo significant changes in the coming years.
The third phase of the sale featured 88 coal blocks, while the fourth round, held in December 2021, featured 99 coal mines, with 59 fully explored and 40 partially explored.
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Coal 960 lakh tonnes, Lignite 52 lakh tonnes, Bauxite 2,103 thousand tonnes, Chromite 601 thousand tonnes, Copper conc 11 thousand tonnes, Iron ore 227 lakh tonnes, Lead conc 41 thousand tonnes, Manganese ore 331 thousand tonnes, Zinc conc 164 thousand tonnes, Limestone 391 lakh tonnes, Phosphorite 124 thousand tonnes, Magnesite 12 thousand tonnes, Gold 148 kg, and Diamond 34 carat were among the important minerals produced.
Manganese ore (80.1%), Lead concentrate (74.9%), Phosphorite (57.0%), Copper concentrate (50.2%), Chromite (45.8%), Limestone (45.6%), Magnesite (44.9%), Zinc concentrate (43.2%), Bauxite (33.4%), Lignite (25.3%), Iron ore (13.7%), and Coal (13.7%) were among the important minerals with positive growth in March 2021 over March 2020. (0.2 percent).
In 2020, 19 coal blocks will be auctioned for commercial mining. With a combined peak capacity of 51 MPTA, these mines are estimated to generate over INR 7,000 crore in income.
When compared to the same month in 2020, India’s coal production climbed by 6.13 percent to 79.60 Mn Ton from 75 Mn Ton in January 2022. Recognizing the necessity of bringing sustainability to coal mining, the Ministry of Coal and all coal PSUs have established a “Sustainable Development Cell” to promote the implementation of better environmental management practises in coal mines.
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Business Opportunities in Metals and Mining Industry in India:
Metals and mining assets have a lot of upside potential for investors. There are numerous prospects for investors to profit from enterprises that mine minerals and metals for both the domestic and international markets. There is also the option of investing through mutual funds or direct equity investments.
The Metals and Mining Industry in India is currently seeing unprecedented expansion. The price of base metals such as iron ore, nickel ore, and aluminium has been steadily rising in recent years.
Steel production has surpassed 72 million tonnes per year (MTPA). India’s iron ore, nickel ore, and aluminium growth potential is still quite strong. These metals have great growth potential as a result of rising industrialization and urbanisation processes both domestically and internationally.
India is the richest country in Asia in terms of mineral resources, with vast amounts of bauxite, coal, copper, iron ore, mica, phosphates, rock salt, and uranium. About 5% of the world’s total proven mineral reserves are held by the country.
It has substantial quantities of metallic minerals such as lead, zinc, silver, gold, and platinum group elements, among others. Apart from these minerals, large amounts of aluminium, diamond, gypsum, limestone, magnetite, marble, and silica sand can also be discovered. There are many uncharted places where geologists are still looking for fresh sources of gold, diamonds, and other minerals.
Related Business Plans: Mining, Quarrying, Mineral and Ore Processing, Coal, Iron Ore, Limestone, Chromite and Granite Mining
Drivers of Growth:
Cost Benefit: Steel and alumina production conversion have a cost benefit.
Infrastructure and transportation demand is increasing: Housing for all by 2022 and the extension of the railway network are two examples of rising demand from the infrastructure and transportation industries.
Unexplored Mines: Only 20% of the total mineral deposits have been exploited to date.
Government Policies that Help: Captive miners are allowed to sell coal on the open market.
Atmanirbhar Bharat Abhiyan: Under the Atmanirbhar Bharat 3.0 package, a Production Linked Incentive plan in the specialty steel sector has been introduced.
Single Window Clearance Portal: A centralised platform for obtaining the clearances and approvals needed to start a coal mine in India.
Production Linked Incentives (PLI) Scheme:
The Union Cabinet, led by Prime Minister Shri Narendra Modi, has approved the introduction of the Production-Linked Incentive (PLI) Scheme in Specialty Steel to Improve India’s Manufacturing Capabilities and Exports – Atmanirbhar Bharat. The deadline for applications has been extended to May 31, 2022.
Industry Trends:
- Demand for steel and aluminium is being driven by the rise of the automotive industry.
- Steel production is expected to increase to 300 MT by 2030.
- Longer mining leases (20-30 years) and greater openness in mine distribution are part of the mining sector’s opening up.
See More Links:
Government Ministry/ Department
Industry Association
- Indian Steel Association
- India Stainless Steel Development Association
- Aluminum Association of India
- Coal Consumers Association of India
- Federation of Indian Mineral Industries
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