Bauxite Mining in Eastern India: Why Not Us? Why Not Now?

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While Indonesia has banned the export of unprocessed ore, China, its largest consumer, continues to stockpile aluminum ingredient bauxite. In neighboring India, though, producers are still trying to explore the means of increasing bauxite mining, and turning two of the country’s provinces, rich in high-grade bauxite, into the world’s “most preferred” destination for investments in the aluminum industry.

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A few days ago, at an international seminar organized by the International Bauxite, Alumina and Aluminium Society (IBAAS) in India, speakers talked of clearing hurdles that were in the way of bauxite mining in India’s Eastern Ghats, propelling the two provinces in the region, Andhra Pradesh and Odisha, into the world’s most sought-after bauxite destinations.

As much as 52% of the resources are found in Odisha, where the country’s 3 aluminum groups – Hindalco, Vedanta and National Aluminium Company (NALCO) – have their plants. Together, with Andhra Pradesh, these 2 major bauxite-owning states are facing opposition from many of the stakeholders involved in the opening of new, larger mines.

Vedanta Resources Chief Executive Tom Albanese, for example, in his keynote address, said raw material security was the main point of concern for investors in India’s aluminum sector. Albanese pointed out that China (when it comes to India these days, almost everyone brings up its red neighbor) had been able to get over poverty by making huge investments in aluminum production.

He said even a small country like Guinea had improved its economy by exporting bauxite ore, so why not India? According to this report in the Hindu Business Line, it’s no secret that India’s Eastern Ghats have some of the world’s finest bauxite reserves. Experts have been of the opinion that once mining was allowed in full swing, the Indian aluminum industry could attract multibillion dollar investments, opening up not only employment opportunities for thousands, but contributing about $25 billion to the Indian exchequer in about 15 years.

The author, Sohrab Darabshaw, contributes an Indian perspective on industrial metals markets to MetalMiner.

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