Friday, June 14, 2024

Sustainable Mining of Bauxite Resources Needed for India to be a Global Aluminium Hub

Aluminium, a metal of strategic importance for India to attain its goal of becoming a $5 trillion economy, continues to be a highly imported metal. This is despite India having the world’s 5th largest coal and bauxite reserves, both of which are important raw materials for aluminium production. This is in addition to the fact that India is the 3rd largest producer and consumer of aluminium globally with domestic demand expected to expand from current 4 MTPA to 12 MTPA by 2030. For this, a multi fold growth in bauxite production from current levels of 20-22 Million Ton to 72 Million Tons per year is needed to meet the domestic requirement. To this essence, tapping the country’s 3.8 Billion Tons Bauxite reserves is a key step to gravitating India towards becoming self-reliant.

Import of bauxite, one of India’s most abundant ores, has caused an estimated forex loss of over 400 Million dollars in the last 5 years alone and caused missed opportunities of generating mass scale employment. Bauxite mining creates livelihood opportunities in regions which otherwise have limited potential for other economic activities. Opening of a single Bauxite mine has the potential to generate over 10,000 livelihood opportunities and can garner over Rs. 5,000 crores to the State revenue over the life of the mine.

Aluminium is of strategic importance and is a critical raw material in defence, transportation, electricity, aerospace, automobile, consumer durables and many more sectors. It is an essential commodity for various other industries / SMEs due to its critical role in diversified applications. With huge Investments of over Rs. 1.5 Lakh crores the sector creates over 20 lakh direct and indirect jobs and has developed over 4000 SMEs (Small and Medium Enterprises in the downstream sector.

“It is a travesty that even with such abundant bauxite reserves and available aluminium capacity for value addition in the country, no Metallurgical Grade Bauxite Mines have been successfully auctioned in the last 5 years since inception of MMDR Act 2015 forcing the domestic industry to import.  The eco-friendly and sustainable mining methods lead to economic, social and environmental harmony. Thus, utilizing India’s natural bauxite dividend should be a policy priority to realise the vision of an AatmaNirbhar Bharat,” said Ansuman Das, Former Chairman and Managing Director, NALCO and metals & mining expert.

The abnormality of the arbitrary determination of Average Sale Price (ASP) of Metallurgical Grade of Bauxite linked with the selling price of the end-product Aluminium has led to various state governments being unable to auction the bauxite mineral blocks as the present system of Bauxite ASP Calculation will make the production of Aluminium unviable in the country. Additional and planned investment of over Rs. 50,000 crores in the Aluminium sector has been put on halt as it has been deemed futile in the current Bauxite Average Sale Price regime.

Indian Aluminium producers have introduced sustainability measures to restore land that has been mined to a natural and economically usable state for rehabilitation and livelihood. Land with rich bauxite reserves is mostly barren and uncultivable. After the mined-out area is reclaimed by backfilling of the top layer soil, the surface is brought back to the original ground level and then becomes cultivable. Today, the mining commitment includes extensive re-greening of the mined land and proactive participation in the socio-economic development of communities around. There are significant opportunities to implement technology-driven scientific mining techniques in bauxite mining in India as most of India’s bauxite reserves are located on a single plateau making bulk open cast mining possible.

The time is now right to try and resolve the Bauxite Average Sale Price issue by aligning it to bring it in line with other bulk minerals, auction the available Bauxite Mines and fully utilize the potential of the domestic Aluminium Industry to become self-reliant, save precious foreign exchange which will lead to creation of wide range of employment opportunities locally while yielding rich socio-economic dividends for all stakeholders.

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