Metals & Mining: A Polish Mining Delegation explores opportunities in Kolkata

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December 2014 saw a Polish Mining delegation visit Kolkata consisting of senior officials from seven companies namely JSW S.A., SIGMA S.A., BUDWAK Sp. z o.o., BZUG Sp. z o.o., Becker-Warkop Sp. z o.o., KOPEX S.A. and FAMUR S.A. The delegation was led by Mr. Tomasz Wi?niewski, Counsellor in the Economic Section, Embassy of the Republic of Poland in India.

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EBTC organised B2B meetings for the Polish companies with Indian companies on 15th December 2014, followed by factory visits and further meetings on 18th and 19th December 2014. These visits and meetings are expected to lead to important co-operations on the table in the near future. Experts on the ground, Mr. Suman Lahiri, Regional Director and Mr. Som Sekhar Ganguly, Business Development Executive from EBTC Kolkata accompanied the delegation.

The Metal and Mining Industry in India

India’s Metal and Mining industry expanded at a strong rate of 19.8 % in 2011 and touched US$ 141.9 billion (€119.71 billion). The CAGR of the industry is 5.2% and there has been a steady growth in production during the period 2007-2011. 100 % Foreign Direct Investment (FDI) in the mining sector under the automatic route has been allowed by Government of India. Mining lease has been granted for a much longer duration of minimum 20 years and maximum up to 30 years. The Mines and Minerals Development and Regulation Bill (MMDR Bill 2011) has been approved by the government that will provide better a environment for investment and technology.

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Major Challenges

Some of the major challenges in the metal and mining industry includes environmental issues, lack of assessment of natural resources, high cost of production, etc.

Mining in India significantly affects the environment adversely. A few effects include:
• Blasting operations leads to the production of dust in surface mining.
• Methane is released from coal mines.
• Large volumes of water are used in mining and sulphide containing mineral is released during mining which gets oxidized and reacts with water to form sulphuric acid.
• Moreover underground mining is harmful with regards to health and safety due to poor visibility and poor ventilation.
• Air and water gets highly polluted and people and communities get uprooted.

Another major issue in mining sector in India is a lack of proper assessment of natural resources. There are many areas in India that are unexplored and resources needs to be accessed. There are uneven distribution of minerals.

Cost competitiveness is an important aspect for mining industry and to achieve that sustainable production is required. Mining costs of Indian mining companies are much higher than international players. The main reason for it is low output per miner than other countries. There is a lack of investment in technology and deep organisational transformation is required. Also India has highest royalty rates for minerals.

Opportunities

India has permitted 100% FDI in mining exploration, mining and mineral processing. This will lead to the exposure of Indian mining industry to global best practices and foreign technology. Joint ventures between foreign companies and Indian companies can lead to mobilisation of finance and technology transfer and will also give access to global markets. Development and production of surplus commodities like iron ore and bauxite, mica, potash etc apart from coal and other industrial minerals is also an opportunity. Opportunity is also there for future discoveries of deposits with modern techniques.

It can be inferred that the EU companies should explore business opportunities in these sectors, especially as the Indian metal and mining sector is putting more emphasis on applications of clean and efficient technologies for exploration and adaptation of safe mining practices.

The sector is an important area for the eastern region of India to surge ahead economically in the near future, and EBTC is well poised to support the entry of EU Companies in these sectors especially in the eastern region and EU Companies can take advantage of EBTC to initiate operations in the eastern region and across India.

Contact: This email address is being protected from spambots. You need JavaScript enabled to view it. (Regional Director, EBTC)

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