Highlights the importance of mining industry for an individual as well as for our world economy as a whole .

1. Contribution Of Mining In The
Global Economy
Pratyush Kumar Katiyar
13155061
IIT(BHU) Mining Engineering
(pkumar.katiyar.min13@itbhu.ac.in)
7753863532

2. World Bank Data(Contribution of mining )
Year - GDP Growth rate ( GDP US$)
1970 - 4.29% (2.95 trillion US$)
1980- 0.5% (11.15 trillion US$)
1995- 2.96% ( 30.65 trillion US$)
2005 - 3.82% (47.14 trillion US$)
2010- 4.35% (65.6 trillion US$)
2015 - 2.6% ( 73.43 trillion US$)
Year – Income from renting natural
resources , %of GDP ( Comparison)
1970- 1.18% of GDP (0.035 trillion US$)
1980- 7% of GDP (0.78 trillion US$)
1995- 1.81% of GDP (0.55 trillion US$)
2005- 4.49% of GDP (2.12 trillion US$)
2010- 4.71% of GDP (3.09 trillion US$)
2015- 3.92% of GDP (2.88 trillion US$)

3. Three sectors of Global economy
1. Industry- 30.3% of world’s GDP
2. Services – 63.7% of world’s GDP
3. Agriculture - 6% of world’s GDP
JOHANNESBURG MINING REPORT
by MARK CUTIFANI :
Mining directly and indirectly
contributes to 45% of world
economy through its contribution
in all 3 sectors mentioned above.

4. Industry- Contribution of mining

5. Case Study: Direct Economic Impact of Gold

6. Core Sector Industries
There are 8 core sector industries in India:
1. Coal - coal mining
2. Crude oil - mining
3. Natural Gas - mining
4. Fertilizers – Main components are nitrogen, phosphorus and
potassium. Phosphorus and potassium are mined.
5. Electricity – Coal, natural gas and petroleum(67.4% ) plus
renewable sources
6. Iron and Steel – iron ore mining
7. Cement – Limestone and clay mining
8. Oil refinery - An oil refinery or petroleum refinery is an
industrial process plant where crude oil is processed and
refined into more useful products such as petroleum naphtha,
gasoline, diesel fuel, asphalt base, heating oil, kerosene, and
liquefied petroleum gas.

7. Electricity Production :
According to World Bank
data, percentage of electricity
generated by coal globally is
increasing continuously from
1975 to 2013 despite the
recent efforts of the world to
shift to non renewable
sources of energy. Reasons-
Cheap , good supply in global
market,easier handling.
Coal (41.3%) + Natural
Gas (21.7%) + Oil(4.4%) =
67.4% of electricity
needs mining
operations.

8. Alternative Sources cannot exist without mining
Solar Energy

9. Wind Turbines

10. Atrracts Foreign Direct Investment (FDI)
Mining FDI often dominates the total flow of FDI ,
specially in those economies which are not
developed enough to attract foreign capital in
other sectors. Example –
Ghana is Africa’s second-largest gold producer
after South Africa, producing approximately 4
percent of the world’s gold. The mineral sector
has attracted over U$2 billion investment in the
form of FDI representing over 56%, total FDI to
Ghana .

11. FDI Policy for miningin India(UnderMake in IndiaPolicy) :
• FDI up to 100% is allowed in exploration, mining, minerals processing and
metallurgy under the automatic route for all non-fuel and non-atomic
minerals including diamonds and precious stones.
• Mining and mineral separation of titanium-bearing minerals and ores, its
value addition and integrated activities fall under the government route of
foreign direct investment up to 100%.
• FDI in coal mining is allowed for captive consumption only.
FDI by China
FDI directly
effects
industrial
growth in
developing
economies

12. Miningcontribution in infrastructure industrial andconsumer goods
industries
Iron – Primarily used in making steel which is used in machine
parts, building structures, manufacturing machine tools etc.
Copper- Wiring ,motors , construction industrial machinery etc.
Aluminium- automobiles, Packaging , Construction etc.
Zinc- Galvanise other metals, such as iron; batteries etc.
Petroleum - Gasoline, jet fuel, diesel fuel, tar ,lubricating oil etc
Limestone – cement
Coal - Energy
Gold , silver, diamond – jewellery , cutting tools , decoration etc.
Sulphur - gunpowder, matches etc.
Industries cannot exist without minerals , therefore entire industrial
sector is dependent on mining , without mining, there will be no
industries.
Hard to find an object around us without contribution of
mining !!

13. Macro level Contributions of Mining
All these aspects directly effect industrial growth
GHANA (gold) – 56% FDI for mining

14. Service sector - Contribution of mining

15. Employment Generation :
Geneva Based International Labour Organisation Report –
Developed nations – 1.5 million people in mining sector
Developing nations – 2.2 million people in mining sector
Small Scale mining – 25 million people
Indirect employment(Equipment production, maintenance , food
,transportation and other services including contractors and
suppliers)- 150million people
All industries create this kind of spillover effect known as multipliers
but mining sector generally creates higher multiplier effect than
other sectors.
Provides greatest avenue for unskilled labour employment.
Those who work in mining enjoy the highest wages and salaries of all
industrial sectors .Example- Mining Association of Canada states-
Mining sector average annual pay exceeding $100,000 surpassed the
average earnings of workers in forestry, manufacturing, finance and
construction by a range of $21,000 to $33,000 for those sectors.

16. Mine development leads to expansion of transportation :
Road Transport - Dumpers, trams, and trucks move minerals around mines .
Rail Transport Trains transport nearly 70% of mineral deliveries in the
United States for at least part of the way from mines to consumers.
Water Transport Barges transport mineral on rivers and lakes.
Ships transport coal on the Great Lakes and the oceans to consumers in the
United States and other countries.
Pipeline Transport Slurry pipelines move mixtures of crushed coal and
water. This method is not currently in use in the United States.

17. Example –The Indian Express-
In 2014–2015 Indian Railways
had revenues of US$24 billion
which consists of US$16 billion
from freight, US$6.0 billion
from passengers tickets and
US$2 billion from sundry
earnings . In fiscal year 2014-
15, coal constituted 50% of the
freight loading , so 33%
revenue of Indian railways
comes from coal
transportation.
Similar is the case with USA ,
Association of American
Railroads – “No single
commodity is more important
to America’s railroads than coal
, which accounted for 38.8% of
rail tonnage and 19% of rail
revenue in 2014.”

19. Services required by mining sector

20. Agriculture – Contribution by mining

21. PROVIDES FERTILIZERS :
Plants rely on three essential nutrients –
nitrogen , potassium and phosphorus.
Potassium and phosphorus are mined and
applied through fertilizers .
(China is the largest producer of phosphate and
Canada is the largest producer of potash)

22. CorporateSocialResponsibilityprojects:
Newmont Mining Corporation’s AGGI program( Ahfo Agribusiness Growth Initiative) :
Provided training to 1,368 farmers to increase agricultural productivity and farm
business skills.
Bulga Coal Mine , Australia Initiative :
Promoting viticulture and water resources .
Such corporate social responsibility projects with farming friendly initiatives may
contribute significantly in the development of agriculture sector.
MishraandPujari:CaseStudyin Stateof Odhisa(2008):
Effect of mining on the life of the surrounding villages showed
improvement in the livelihood of farmers with increased per capita
income.
Improvesinfrastructureandruralconnectivity: Peru Mining Study report illustrated that
new roads constructed for the Yanacocha Peru mining operation
decreased the time it took for farmers to reach markets as well as
decreasing their transport costs

23. Allegations against mining by farmers
Mainly due to acquisition of land for mining operation and
pollution of water by mining.
Land used for mining
USA – 0.1 %
Canada- 0.01 %
Peru – 0.08 %
Australia- 0.26%
Similar is the case with water resources.(USA -1% of total water
consumed and Australia – 2-3% of total water consumed)
Mining uses very less land and water resource of a nation. But
still , Resettlement and rehabilitation of people is a matter of
primary concern . Water treatment plants should be properly
monitored and required attention for water quality management
should be given.
Besides this , the contribution of mining to agriculture is
significant as explained in the previous slides.

24. Mineral Education Coalition Report 2015

25. Minerals are so basic to human need , just after food
that life without mining is difficult to imagine in
today’s world