Prime Minister Narendra Modi’s vision of making the country ‘Atmanirbhar’ is deeply entangled in India’s achievement of self-sufficiency in key minerals hence it is essential to revive the mining industry for the benefit of the economy and people says Sauvick Mazumdar, CEO, Vedanta Sesa Goa Iron Ore.

What is your outlook for the mining industry post-2020? How has the year been for Sesa Goa and what opportunities await in the post-Covid market?
The mining sector has a critical role to play in making India a $5 trillion economy. As per Confederation of Indian Industry (CII) study, the sector contributed 2.6 per cent to the country’s GDP in 2018-19 down from 3 per cent in 2011-12. It will need concerted efforts of policy makers and stakeholders for the mining sector, to regain its 3 per cent share in the GDP and further increase the contribution of mining sector to the country’s GDP through sustained efforts towards unlocking the true potential of this particular sector. Contribution of the mining sector to the gross domestic product (GDP) needs to be more than double, for the country to reach a double-digit growth rate.

Even though India has done well on the ‘Ease of Doing Business’ ranking, investment in the mining sector has been tepid. The sector has witnessed no significant investments despite permission for 100 per cent foreign direct investment (FDI) in the sector. Under the ‘Atmanirbhar Bharat’ scheme, the Centre has taken glide of measures to attract private investments in the metal and mining sector. This also includes proposed mining reforms to accelerate growth and employment generation in the country. One such reform is, to raise India’s coal output; the government has allowed commercial mining by private entities. This will enable the country to achieve self-sufficiency in minerals and also provide thrust to economic development and employment generation.

Covid-19 pandemic has adversely impacted the global economy and there is a need to take up some bold steps for the revival of India’s economy. Industries such as the Goa Mining industry are at a halt for more than two and half years now thus, adversely hitting the Goan state economy. With all the steps that the government is taking, we are extremely hopeful of the positive outcomes soon.

The growth of the mining sector is crucial for the Atmanirbhar Bharat initiative, what steps need to be taken to ensure that the results are achieved?
Mining is a major economic activity and contributes significantly to the Indian economy. It has immense potential to create massive job opportunities across the country. India is yet to fully explore the mineral wealth and sustainable growth of the mining sector. India’s goal to become Atmanirbhar can be achieved if we can use our natural resources efficiently and unlock its full potential.

Various embargoes on the mining industry have directly resulted in a huge loss of revenue to the government. Mining emerges as third largest in terms of employment generation. It means every 1 per cent growth in the mining sector’s GDP increases employment in the sector by 0.52 X. Mining Industry gives direct employment to ~ 2.3 million people and indirect employment to 23 million people.

The need of the hour is to introduce more reforms to revive the mining industry for the benefit of the economy and people. The path to the self-reliance of any country goes through the sustainable mining sector, which can support rapid industrialization and positively impact the lives of millions of Indians.

The following reforms and policy changes in the mining sector will facilitate the overall growth of our nation:
An immediate restart of mining operation in Goa through a Legislative amendment in the relevant Act. This move will immediately contribute more than ~ 3000 crore/annum to the state and central exchequer, provide employment to more than one lakh people, protect four lakh livelihoods and contribute forex earnings of ~ $ 1 billion/annum to the state of Goa.

• An inter-ministerial task force should be set up to scrutinize all such cases under sec. 10A (2) (b) and determine whether the applicants had done everything within their power to fulfil the conditions laid down in sec. 10A (2)(b). Arrangements should be made to speed up the necessary approvals or clearances and have the mining leases executed. This approach will help in quick operationalization of the mines covered by these applications and the doubling of the contribution of the mining sector to India’s GDP.
•  Reducing Effective Tax Rate (ETR) on the mineral sector: Government needs to rationalize the taxes in line with the international prevailing ETR to incentivise enhanced production of minerals in the country or at least bring parity in the states of Goa and Karnataka with rest of India. (Total Mineral taxes including Royalty, NMET, DMF i.e. 19.8 per cent in India (Except Goa and Karnataka) whereas in countries like Australia and Brazil, it is 7.5 per cent and 2 per cent respectively, which makes them highly competitive in global trade. In states like Goa and Karnataka, there are additional 10 per cent taxes such as GIOPF & SPV, which make it further worse to keep it even domestically competitive.
• Removal of trade restrictions in Karnataka: Freedom of sale doesn’t exist in Karnataka and apparently, this is the only state in India wherein no long-term contracts can be established between the buyer and the seller. All the sale has to go through the restricted e-auction platform and therefore, there is no level playing field between buyer and seller. Immediate steps need to be taken to make Karnataka mining at parity with other states in India.

The government has furthered the participation of private interests in mining, how will it help the sector in the long run?
Prime Minister Narendra Modi’s vision of making the country ‘Atmanirbhar’ is deeply entangled in India’s achievement of self-sufficiency in key minerals. It is a well-established fact that becoming a global economic superpower will entail exploration and extraction of natural resources sustainably for supporting the growth of the core sectors.

The decision to allow participation of private interests in mining will lead to the introduction of more cost-effective and innovative sustainable mining technologies. The constructive competition in the sector will help in steady growth and effective utilization of natural resources to the fullest.

What are some of the hurdles which have come into play owing to the pandemic that the mining sector needs to take a close look at and address?
Immediately after the nationwide lockdown was declared, most of the industries were temporarily stopped. Mining industry being labour intensive, it faced huge challenges including that of job loss for the daily wage manpower. At Vedanta Sesa Goa Iron Ore, our topmost priority is the safety and security of all our stakeholders. We have ensured the safe workplace and uninterrupted supply of essential goods for all the employees, contract workers and vulnerable people in the communities during the lockdown period.

Since the phase of unlocking has started, the biggest challenge has been to motivate employees and keep the work momentum going on with limited operations and limited workforce. In the initial phases, there were little hurdles in adapting to the new normal and spread awareness among all stakeholders about the importance of following the new normal. Some of the measures adopted by the industry, to break the transmission chain and ensure the safety of the workers include the following:

• Operating people in shifts and batches with staggered timings. • Ensuring a bare minimum workforce that is essential for plant operations at the site and allowing rest all the enabling functions to operate from home.
• Strict protocols for personal hygiene, sanitation and social distancing at plants.
• Safety precautions including the supply of sanitizers, protective gear, masks, regular temperature checks and availability of 24×7 medical support at all the plant locations.
• Fumigation and sanitizing the areas in and around our facilities consistently.

Fortunately, these measures have helped us to take control of the situation. At Vedanta, we strongly believe in a technology-based solution for any challenge. In this case, we have adopted technology for new normal, which is AI and machine learning-based solution to improve the compliance of MHA guidelines in plant premises and we have seen a substantial transformation due to these.

What are some of the tech transformations that have become mandatory for Indian mining to match global standards? What are some of the innovations that Sesa Goa has already put into practice?
Rapid advances in technological innovation, including through automation and digitization are having a fundamental impact on the mining sector around the world and India is no exception to it. Most of the mining operations are highly mechanized with almost negligible human interventions, which has helped to raise the safety standards of mining operations manifold.

At Sesa Goa Iron Ore Business, we have a fully digitalized Command and Control Centre at our mines, which ensures remote monitoring from pit to port with the analytics-based approach. We have a Concept of Centre of Excellence, which seamlessly integrates the three major verticals for breakthrough innovations/ improvements i.e. digitization, innovation and asset integrity. “Sesa Café” – an innovation hub created across all locations gives space for people collaboration and creates innovation culture.

Sesa Goa iron ore business is equipped with a leading-edge beneficiation technology, holding more than 50 per cent capacity of total state beneficiation potential that can convert the ultra-low grade iron ore to a saleable product thereby, unleashing true mineral resource potential of the state and the country at large. Sesa Goa iron is a pioneer in the introduction of the use of geotextiles for the reclamation of mine and dump sites. Our Sankhali Reclaimed Mine is one of the role models for the systematic reclamation of mine for the Biodiversity conservation. Sesa Football Academy started in 1999 was developed on reclaimed Sanquelim mine with a vision to become a premier academy in India for developing quality footballers from the state of Goa and across India and has developed many talents for the country so far.

Our Value-Added Business (VAB) is migrating a step ahead in this digital era by adopting the smart manufacturing practices and taking the business model to go predictive in near future with the help of manufacturing execution cum excellence system. This state-of-the-art predictive technology will make the VAB, a world-class benchmark. Focus on Pit to Port Automation and advanced exploration technology will give a competitive edge in mining space and the transformation will be manifold with the scale of economics.