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BW Businessworld

Mining: A Solvable Crisis?

The ban on mining iron-ore in Goa has crossed 18 months virtually killing all the aligned businesses and impacting 70,000 households and 3 lakh livelihoods

Photo Credit : Reuters


For Maruti Chari, the 63-year-old ace mechanic in Ponda, an industrial hub in south Goa bordering Karnataka, it is a matter of months before he winds up his popular truck repair garage spread over 2 acres of prime land. For more than 40 years now, Chari has been the ‘go-to’ mechanic for hundreds of trucks ferrying iron ore from nearby mines, including those in neighbouring Karnataka. After all his garage is right on the Ponda-Belgaum highway (NH-4).
“I was repairing 40-50 trucks a day before the mining ban. I have been recognised by most truck and auto companies. Today, not even four trucks come for repair/overhaul in two days and sometimes the whole week,” says Chari adding, “Saab kuch karo humare liye, hum roz marr rahe hain (Sir, please do something for us, we are dying every day).”

Chari owes around Rs 50 lakh to creditors. “I will wait till December. If mining does not restart, I will have to either sell my land or give it out on rent, which will be a very difficult thing for me to do,” he says.

Thanks to the ban on mining, there are others like Santosh Thambi, a machine operator with Chowgule Group company, Yeshwant Satgaonkar, a plant operator, and Sandeep M. Nirlekar, all ex-miners who are out of work and facing extreme financial crisis.

BW Businessworld was in southern Goa meeting out-of-work miners, barge owners, trucking companies, and equipment suppliers almost 19 months after mining came to a grinding halt in the state ever since the Supreme Court cancelled 88 mining leases on February 7, 2018, which halted mining activities beginning March 16, 2018.

The ban has stopped export of 15 million tonnes of iron ore. The decision, it appears very clearly, has disrupted an entire ecosystem of allied industries. Is the situation redeemable? “Very much so,” say several mining professionals in unison. Can the state government solve it on its own? “Not really. The central government will need to do it and they can by way of ordinance,” says a local politician requesting anonymity. “This is a sensitive matter. The Supreme Court is examining it. So is the Centre,” he adds.

Vexed Issue

There are two different set of Acts and two different court orders allowing mining in Goa. Then there is the Supreme Court order banning mining in 2017 across states including Goa. Then one of the Acts —Mines and Minerals (Development and Regulation) Act and the Supreme Court order says that all mining leases in most states will expire in 2020. “It is a solvable issue but it is linked to a wider industry issue on pan-India mining. The central team under Amit Shah ji (Union Home Minister), will come out with something workable very soon,” says another Goa politician.
Meanwhile, the Goa Mining People’s Front (GMPF), the body representing the mining-dependent says the government should resolve the issue and commence mining at the earliest. “How they resume mining, they should decide. We want a decision. We want it at the earliest,” says Puti Gaonkar, President, GMPF.

Ambar Timblo, President of the Goa Mineral Ore Exporters’ Association (GMOEA), an industry body of the miners is optimistic. “Indians by nature are always optimistic and that is what keeps us moving forward,” says Timblo.
But not everyone is inclined to think so. Take, for example, the case of Chandrakant K. Gawas, a veteran of over three decades in the shipping business. His barge (vessel ferrying iron ore), barely floating on the shores of Vasco, lies alongside other rusted, half-sunk barges. Technically, barges are slag marine vessels used for ferrying iron ore, coal, limestone and other cargo from the shallow shores to the big cargo vessels parked in deeper seas.

“Today I owe several crore to the banks. Even if mining restarts tomorrow, I will require at least Rs 50-60 lakh for the repair of just one barge. No bank is giving us loans because of defaults due to the ban on mining. The government is not solving the loan-related issues. Bankers keep sending us notices and keep adding late charges, penalty, etc. on the default amount. We are not defaulters. I can’t sleep at night. I don’t know what I will do in the next few months,” says a visibly disturbed Gawas. He runs a company called Sagar Marine Services that is into shipbuilding and repair both of which have ground to a halt.

Hoping for the Best 
Goa Chief Minister Pramod Sawant was in Delhi in early October to meet Amit Shah, the Union Home Minister and head of Group of Ministers (GoM) looking into the possible solution to the mining ban issue. Sawant also met Pralhad Joshi, the minister for coal, mines and Parliamentary affairs, who is also a member of the GoM. “The Centre will come out with a judicial or political solution to resolve the mining issue in Goa by December,” Sawant told reporters after the meeting. The GoM includes Union Ministers for Finance, Environment, Agriculture, Mining, Commerce and Industries, Petroleum and Law.

Till the end of July, the Goa government reported a revenue loss of almost 25 per cent due to the mining industry shutdown. “Just as when Goa was regaining hold over the economy after the global slowdown, the ban on the mining industry posed another challenge for the government,” Sawant had said addressing the 111th annual general body meeting (AGM) of the Goa Chamber of Commerce and Industry in July. It should be noted here that tourism and mining sectors are mainstays of the economy of Goa.

Home Minister Shah has already listed resumption of mining in Goa as one of the government’s priority. In fact, when Shah was in Goa in August he conveyed the sentiments to the state BJP leaders. “The issue about resumption of the mining activities in the state was discussed with Shah and he assured that it is top on his priority list. He said the Centre is committed to resuming the mining activity in a time-bound manner,” Goa BJP spokesperson Damodar Naik had told PTI then.

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