KOLKATA (miningweekly.com) – The provincial government of Odisha’s move to limit mining lease renewals to captive mining would sound the death knell for independent mining, while downstream users would be starved of raw material, industry experts say.

A group of independent industry leaders under the banner of Think Tank-Odisha, with interests in the east Indian mineral-rich province, known as Orissa until recently, said that standalone miners and captive mining performed distinct roles in upstream and downstream mineral and metal industries, and both needed to be supported for holistic industrial development.

A resolution adopted by the provincial government of Odisha stipulated that second and subsequent renewal of mining leases would be granted only for captive mining or, in other words, only to miners who have downstream processing plants.

According to Think Tank-Odisha, the move of the provincial government would discourage standalone mining when global best practise in mining revealed that standalone mining was a trend.

“Restricting mining leases only for captive mining is a very retrograde step. It will kill the independent mining industry and, at the same time, buyers of such miners would be deprived of raw materials,” said Shailendra Kumar Tamotia, convenor of Think Tank-Odisha and former chairperson of National Aluminium Company Limited, India’s largest integrated aluminium producer.

“Mining and metal making are two very different businesses, requiring different expertise and skill sets. Even the National Mineral Policy 2008 accepted the co-existence of captive and standalone mining,” Tamotia said.

He pointed out that neither the Mines and Minerals Development & Regulation (MMDR) Act nor the MMDR Bill 2011 currently being framed by Parliament mentioned restricting renewal of mining leases to only captive mining.

The industry leaders of Think Tank-Odisha noted that the Indian federal government had also sought the withdrawal of the resolution on restrictive conditions on mining lease renewal.

Odisha was among the most mineral-rich provinces of the country, accounting for 95% of India’s chromite reserves of 213-million tons, 42% of manganese reserves of 378-million tons, 34% of iron-ore reserves of 28.52-billion tons, 52% of bauxite reserves of 3.47-billion tons and 16.31% of coal reserves of 267-billion tons.

The province currently has 129 mining leases in operation covering 541 km² of Odisha.