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Mining: Mainstay of the Indian Economy

  • India is endowed with significant mineral resources and produces 89 minerals classified as fuel mineral (4); metallic mineral (11); non-metallic mineral (52)and; minor minerals (22).
  • The mineral sector accounts for 11% of the Country’s industrial production. 
  • The total value of mineral production (excluding atomic minerals) during 2005-06 is estimated at USD 16.7 billion, wherein fuel minerals contribute the largest share (USD 12.54 billion).
  • During the year 2004-05, the provisional value of export of ores and minerals was approximately USD 15.41 billion, in which diamond (mostly cut) was the major export item accounting for 67.1% of the total exports, followed by iron ore (20.1%) and granite(3.7%).
  • The key mineral producing states of the Country includes Madhya Pradesh, Chhattisgarh, Jharkhand, Andhra Pradesh, Maharashtra, Orissa, Rajasthan, Tamil Nadu etc. 
  • Various international mining companies such as BHP Minerals- Australia, Meridian Peak Resources- Canada, Metdist- UK, Phelps Dodge Corporation- USA and Rio Tinto- UK among others, have received licenses for mining in the Country.
  • The public sector is a dominant player in the sector and contributes over 85% of the total value of mineral production.  
  • However, recently Indian non-coal mining sector has fully opened the doors for private investment (both domestic and foreign).  The changes/ modifications in the Mineral Policy, have made India comparable to any liberal regime existing in other major mineral producing countries in the world. 
  • The mineral sector is highly fragmented where 95% of operating mines produce about 50% of the value of the minerals, thereby providing an opportunity of consolidation.
  • As a result of economy boom, resurging industrial production and rapid infrastructure development, the demand for minerals is growing fast in the Country. The emergence of a vibrant middle class has created demand for base metal products, in addition to the traditional demand for gold and silver. 
  • This has lead to the need of systematic search and evaluation of new deposits and intensive exploration of the same to boost the production of the reserves of minerals.
  • In this regard, India is looking for state-of-the-art technological and management expertise, which can improve productivity through good planning and design of mines, reduction of costs, and optimisation of smelting and refining operations and by-product recoveries. 

Mineral Hub of India


  • The State of MP has a rich and vast mineral deposits which includes diamond, slate, pyrophyllite, diaspore, coal, limestone, copper ore, manganese among others. Besides, the state also has favourable geological and geotectonic settings. 
  • The State ranks third in the Country in mineral production. 
  • Active mining of these minerals is generating revenue of more than USD 118.65 million per annum.
  • MP is the sole producer of diamond in India. 
  • The State has 41.36% (largest) of the total national reserves of copper ore. It houses India’s largest opencast copper mine at Malanjkhand, district Balaghat.
  • It boasts of the thickest coal seam (135m) of Asia at Singrauli coalfield in Sidhi district.
  • MP is the major producer of limestone and third largest cement producing State with a share of 14% of total cement production in the Country. 
  • It is also the major producer of Coal, Diaspore and Pyrophyllite, Manganese, Dolomite, Glass sand and Fire clay.
  • The State is fast emerging as a dimensional stone  producer 
  • Major reserves of Coal Bed Methane (CBM) have also been identified in the State.

Mineral Based Industries in The State

  • The land parcels in the eastern, south-eastern and western belts of M.P. are the rich in various mineral reserves.
  • Most of these minerals are supplied to other states in crude or semi-processed forms for commercial use and further processing.
  • Due to the large availability of minerals, several mineral-based industries have come up in and around these areas. Some of these industries are cement, thermal power, coal washeries etc.
  • The mining industry along with the downstream/ allied industries have been the major source of employment in the State.

Mineral-based Industry
No. of Units
Rewa, Satna, Damoh, Katni, Neemuch
Thermal Power
Shahdol , Umaria, Sidhi, Satna, Betul, Damoh, Katni, Rewa, Ujjain
Hydrated Lime
Katni & Satna
Slate Pencil
Roofing (Manglore)Tiles
Hoshangabad, Balaghat
Marble cutting& polishing
Granite cutting& polishing
Chhatarpur, Tikamgarh

Taking Mineral Industry a Step Further…
  • The State has proposed to set-up Mineral-based industrial parks to give an impetus to the industry. The cluster approach adopted by the Government would support the core mineral industry as well as the allied/support industries such as jewellery making, crafting, cutting, polishing etc. The units/ companies in these parks would enjoy various fiscal and non-fiscal incentives that would be offered by the State Government. 
  • Further, these clusters/ parks would have two pronged benefits for the State Government and industries wherein  it will be a source of generating employment in the State and would be a source of skilled manpower required for specific industries.

1. In order to harness the benefits of marble deposits in and around the Katni district, the State has come up with the Stone Park at Hardua.
2. The Park is spread over an area of 120 acres and would house 40 units.
3. It would focus on production, cutting, polishing, finishing and export of marbles.
4. The location is in proximity to highway and railway station making it easy for transportation.
5. M.P. Industries Development Corporation has been appointed as agency to development the infrastructure for Stone Park.


1. Gems and jewellery park is proposed to be set-up in Indore.
2. The Park would focus on cutting, polishing, designing and marketing of precious stones and gold jewellery and export of the same.
3. Land area of about 7 acres have been proposed for the Park, which could house about 200 units.
4. The proposed site is very close to Indore airport (2.1 km) and railway station (15 km).
5. M.P. Export Corporation Limited would promote the park, develop the scheme and provide management for setting up units in the Park.

Location Analysis

  • MP belt constitutes of the oldest group of rocks comprising of Archaeans and Proterozoic formation that constitutes nearly 45% area of the State. Further, other younger formations also have a significant presence, thereby justifying the vast and varies mineral reserves. 

  • In addition to this, M.P. is centrally located and well connected through road and rail to other states. This makes the transportation of crude minerals/ ores from M.P. to other states relatively easier. Further, M.P. has proximity to the major industrial states of the Country such as Maharashtra, Gujarat, Uttar Pradesh etc.

  • The State is the major source of raw material for the sustenance of the industries in other states. It supplies bauxite, manganese, copper ore, marble etc. to various states of the Country, as shown in the figure.

  • The vast unexploited mineral reserves in the State, offers a long term strategic opportunities to national and international mining companies.

Advantage MP

MP Offers following Advantages to Mining/ Mineral Industry
Primary Advantage:


Mineral Exploration
Mineral Beneficiation
Downstream industries
ü Yes
ü Yes
Undertaken at a very large scale
Thermal power plants (captive & non-captive plants)
ü Yes
Undertaken at a very large scale
Cement manufacturing & supplying units
ü Yes
ü Yes
Finishing units in the State at local level
Big units for roofing, slate pencils, cladding & decorative things
ü Yes
ü Yes
Unfinished diamonds are sold through auction
Cutting & polishing unit
Marble/ Granite
ü Yes
ü Yes
Small cutting & polishing units
Cutting &  polishing unit  & export unit
Copper Ore
ü Yes
ü Yes
Concentration of ore & supply to refineries in other States
Refineries in the State and supply/ export extracts

Secondary Advantages:
1. Vast Mineral resources.
2. Cost Competitiveness.

3. Land prices are highly competitive as compared to other regions like Maharashtra, Andhra Pradesh, Gujarat etc.

4. Labour cost is less as compared to other mineral intensive states. 

5. Cost of living in M.P. is much lower vis-à-vis other industrial states in the Country.

6. Quality Human Resource.

Disciplined workforce and claims zero man days lost in past several years in the State.

7. Large pool of skilled technical people along with the skilled labour force.

8. Well-Established Infrastructure.

9. High end technology used for mapping the mineral resources in the State and mining of the same.

10. Good connectivity through road and rail to other states acts beneficial for transporting raw/crude minerals.

11. Well established industries such as thermal power, cement, refractories, cutting and polishing units in the State, reemphasises the advantage of its strong industry base and technical know-how.

Government Incentives & Initiatives

  • Priority status given to setting-up of industrial parks such as Granite Park, Gem & Jewellery Park and Stone Park.
  • Mineral Concession on export quality deposits of Granite, Marble etc shall be granted on priority to entrepreneurs who are willing to establish 100% Export oriented units in the State. 
  • All those areas reserved for Public Sector Undertakings shall be dereserved for private entrepreneurs if mining has not commenced in such areas so far or if they have not secured Mineral Concessions and started mining. State Government has granted Reconnaissance Permits to various private entrepreneurs for searching diamond, base metals & other pollymetalic mineralisation 
  • Incentives given to Stone Park includes, rebate in premium for the allotment of land, facility of payment of premium in installments, “Single Window” system, permission to mortgage mining lease hold rights for obtaining the term loan, special cell of Directorate of Geology & Mining to provide guidance, marketing support to the Park.
  • Exemption from electricity duty given for 5 years to industries for their captive power plants (thermal) for which the effective steps have been taken within a year and where the units commence their power generation within the 3 years.

An Investment Destination
  • There is active participation of both public sector as well as private sector in the mining and mineral industry. The major players in various mineral areas are given in the adjoining table.
  • Several other players have also evinced their interests in the sector and major players that have recently allotted/ commenced their units are as follows.
  • Madhya Pradesh State Mining Corporation (MPSMC) has formed joint venture with Madhya Pradesh State Electricity Board (MPSEB) and Sainik Mining to use coal in Amelia district, Sidhi for thermal power generation in the State.
  • MPSMC has formed joint venture with JP Associates for coal mining in Amelia North. JP Associates would use this coal for installing thermal power plant with power generation capacity of 500 MW.
  • Hindalco and Essar Power would use the coal block in Mahan area for power generation capacity of 650 MW and 1000 MW respectively.
  • Further in Cement sector also companies such as SAIL in joint venture with JP Associates, Rewati Cement etc are also coming up with their cement manufacturing plants.
Government/ PSU
Companies/ Organisations
B.L.A Industries (Coal washery)
Subsidiary company of Coal India ltd viz, South Eastern Coal Field Ltd, Northern Coal Field  Ltd, Western Coal Field Ltd.


Hindustan Copper Ltd ( Govt of India Public Sector)
Cement (Limestone)


Satna Cement
Birla Vikas
Maihar Cement
Prism Cement
Diamond Cement
JP Cement
Bela cement
Vikram Cement


National Mineral Development Corporation


Several small entrepreneurs


Manganese Ore India Ltd


RK marble
Ojashwi Marble
Rock Phosphate, Pyrophyllite, Diaspore, Granite, Bauxite


Madhya Pradesh State Mining Corporation (Govt of MP undertaking)

Way Forward

Opportunities in Mining  Industry
  • Mineral reserves identified for private investors.
  • Technology partner with the Government for mining


Opportunities in Mineral-based  Industry
Mineral (Industry)
Reserves Available
Limestone (Cement plants)
Limestone reserve at:
§Damonh-Panna region (~8 million tons)
§Bela-Pagra of Rewa region (~ 20 million tons)
§Raghurajnagar and Nagod Tehsil in Satna
Coal (Captive power plants)
Four blocks of coal deposits in Chindwara district are brought into captive list
Flag Stone (cutting, polishing & finishing units)
217 hector area of flag stone deposit of international standard is present in Shivpuri district
Marble (cutting, polishing & finishing units)
Deposits of marble available in Mundwara and Bahoriband Tehsil in Katni. Good quality marble of various colours are expected in these regions.
Granite (cutting, polishing units)
Vast deposits in Chhattarpur region
Rock Phosphate (Fertilizer plant)
Second major producer in India. Reserves in Jhabua and Chhattarpur district

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20 Feb 2019
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