Mining closure has affected between 40% to 90% of households in the mining areas along with a loss to the economy
Indian Institute of Technology- Indian School of Mines, Dhanbad had carried out a study on the Impacts of Stoppage of Mining in Goa on Socio – Economics. The IIT-ISM have requested for immediate intervention of the union government in Goa Mining matter to protect mining-dependent livelihoods in the state by resumption of sustainable mining operations in the state.
In a recent study, IIT-ISM Dhanbad documented the social and economic impact of the ban on iron ore mining in the state with effect since 16th March 2018 as result of a direct order of Hon’ble Supreme Court of India on 7th February 2018. The ban halted all mining activities and the study found that it adversely affected the economic stability substantially in the mining areas. For these households, mining had been the major source of income and the economic activity contributed to over 20% of GSDP to the State in the recent past.
Mining had been a major economic activity and stable source of income in the region as it accounted for the livelihood of over 60,000 families. More than 25% of the state population was directly or indirectly dependent on mining for their survival. Since mining in Goa is predominantly export based it had also been making significant contributions to the forex reserves of the country.
Over the last decade, Goa’s Mining industry contributed over USD 13bn to the country’s forex reserves. The State Government collected Rs 43.11 Crores in Mineral Royalty in FY 2015-16. The same increased to Rs.314.5 Crores and Rs.239.6 Crores in the FY 2016-17 and 2017-18 respectively. However, in its absence, the state’s debt has been ballooning, it recorded the steepest increase between 2013 to 2020, the period when mining was partially or fully suspended, demonstrating the highly adverse impact on the State’s finances due to mining stoppage. Constant rising State Debt is also a high concern for the state deteriorating state’s economic Health.
Professor Gurdeep Singh, the report guide summarised by saying, stated that “The Report summarises that The State of Goa was a leading example of mining carried out in harmony with stakeholders, however, post the mining shutdown due to the sharp dip in income and unemployment, the expenditure levels are now far higher than income as a result, and households are depleting their savings to meet essential expenses.
Professor Singh further added that “The Report concludes whilst the need for resumption being vital Mining Operations being an important economic activity in the State of Goa, must commence sustainably and on exhaustion of the Mineral Deposit, Mines must be scientifically closed as per the Mines Closure Plan prescribed to ensure that future generations derive additional benefit”
Goa is already in the midst of a fiscal deficit crisis and Mining revenue is crucial for generating revenue surplus for the state. The average additional debt each year has been Rs. 1,055 Crores since 2012. The revenues from the Mining industry has potentially offset more than 50% of the Debt additions each year. The total contribution of mining and its activities to Goa’s state gross domestic product (GDP) has been much over 15%. For two consecutive years, the Goa government, in its annual budgets has conceded that around 20% of its GDP decline is attributable to mining. Since 2015, the state has collected Rs 118.7 crores for Goa Mineral Ore Permanent Fund.
Upon perusing the report Mr. Glenn Kalavampara, Secretary, Goa Mineral Ore Exporters Association stated that “The report reflects the worst fears of the Government and the Industry, that mining stoppage has not only exacerbated the precarious financial conditions of the State but has already resulted in widespread adverse impact on the way people who were dependent upon mining industry for livelihood. The mining dependents in the State have been requesting the State and Central Governments to resume mining in the State at the earliest especially as the State stands on unfortunate cusp of 3 years without mining activities There has been a loss of credibility in the markets and assets are getting attached due to non-repayment of loans.”
The Stoppage has resulted in irreparable damage to the State as well as the Union’s economic activity, GDP, and foreign exchange. This resulted in a year-to-year increase in the Debt of the State Government. Apart from this, abrupt stoppage results in a loss of investor confidence. Other competitors have absorbed the market share that Goan Ore worked for over the international market. The Report has been shared with the Office of Chief Minister of Goa and Office of Ministry of Mines and has sustainably advised mining resumption.