India’s gold mine production is just 1.6 tonnes as of 2020 and could rise to 20 tonnes per year, highlights a World Gold Council report on 'Gold Mining in India".
The report was released on 17 March 2022 as part of a series of in-depth analysis on the Indian gold market. The report highlights how India has a rich heritage of gold mining, but the industry’s growth has been hampered by legacy processes and under-investments.
Somasundaram PR, Regional CEO, India, World Gold Council, said, “Given that India is one of the world’s largest gold consuming countries, it makes sense for it to develop mining capacity. But change is needed for this to happen, legacy hurdles must be reduced considerably, and investments encouraged. There are promising signs in recent years with the changes to the Mines and Minerals (Development and Regulation) Act and introduction of National Mineral Policy and National Minerals Exploration Policy. If this trend continues India’s, mine production is expected to increase in coming years. That said, we see this materialising only over the longer-term as potential investors will, for the foreseeable future, wait to see how successfully the new policies will be implemented. It is only when investors can see real evidence of India managing its gold mining assets more efficiently that we can expect inward investment to emerge. And at that point, the country’s gold mining sector will enjoy a much brighter future.”
The report also highlights three areas of problem which are acting as stumbling blocks for the development of gold mining in the country. Firstly, the process of securing approval for a mining licence is usually lengthy, involving multiple agencies and requiring 10-15 approvals for a single licence. Secondly, the import tax on mining equipment and other direct and indirect taxes remain high compared to other countries. And finally, many of the key gold mining areas are in remote locations in states with poorly developed infrastructure. As a result, there has been limited investment in gold exploration over the past 15 years.
Aruna Gaitonde, Editor in Chief of the Asian Bureau, Rough&Polished
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