The reason is that as Goans were still trying to wipe off the bad loans and financial crisis they faced due to mining closure during 2013-16, they were presented with this crisis in 2018.
By Charudutta Panigrahi
It’s been more than a year since mining in Goa came to an abrupt halt. It’s not the first time the state witnessed disruption in mining activities. However, this time around, the situation is far more worrisome. The reason is that as Goans were still trying to wipe off the bad loans and financial crisis they faced due to mining closure during 2013-16, they were presented with this crisis in 2018.
On February 7, 2018, the Supreme Court ordered closure of all mining operation from March 15, 2018, onwards. This wasn’t because of environmental concerns, but because of the technical reading of a new law, which didn’t take into cognisance a two-decade-old case that would provide clarity. Nonetheless, the court decided to close mining activity, putting the livelihood of 25% of the population into a zone of uncertainty.
A year since, the Goan economy has eroded. The smallest barometer of financial robustness, i.e. the household saving of an average Goan family, has deteriorated. Our report (by the Forum for Integrated Development and Research, or FIDR) has noted that closure of iron ore mining in the state has led to 40% dip in income levels of Goans. The reason is that mining not only contributes to 30% of the state’s revenue, but the whole ecosystem is dependent on it. In fact, the mining industry had put Goans on a high pedestal of per capita income, and now they are not even eligible for the government’s welfare schemes implemented on the basis of poverty or income deficit.
Referring to Mendes G, 2011 (Utkal University, Department of Economics), the FIDR in its white paper submitted to Goa CM highlights that “socio-economic status of households in mining regions is better as compared to that of its non-mining counterparts.” Also, from an agrarian society of the past, “Goa has seen a shift to sectors like manufacturing and tourism.”
The report notes that broader community provisions should have been driven over the years, and implemented by individual mining companies or associations, in a structured and collaborative manner. However, it cannot be denied that mining companies have worked in villages with a goal to discharge the responsibility of bringing in “positive impact through CSR interventions.”
On the state’s GDP, the report highlights that, for two consecutive years, Goa’s GDP declined 20%, attributable to disruption in mining. Apart from job losses, there is a threat to increase of NPAs of banks as entities in the mining machinery, such as trucks, have lost their earning potential. This has put a burden on financial institutions.
The loss of livelihoods, if not reversed on a war-footing, would end up making a severe dent on the social fabric of the people of Goa.
Author and public policy expert