KOLKATA (miningweekly.com) – After several years of contraction, the Indian mining industry has turned the corner, marking a highlight of Prime Minister Narendra Modi’s two years in office.

According to official data, the mining industry notched up 8.2% growth during the first eleven months of the 2015/16 financial year, which is now being touted as a considerable achievement by the Modi government against the backdrop of four consecutive years of contraction until 2014/15.

The mining industry also contributed significantly to bolstering the Index of Industrial Production (IIP), which registered an average growth of 2.6% during the first 11 months of the financial year. Mining has a 14% weightage in the IIP.

However, owing to the meltdown in global commodity prices, the mining industry’s growth, in value terms, contracted about 11% during the period, even though in quantity terms, user industries showed an increase in the consumption of metallic minerals.

The Mines Ministry estimated that metallic minerals mined during the 11-month period increased to 170-million tons, from 140-million tons during corresponding months of the previous financial year.

“There has been a complete turnaround for the mining sector. The government expects mineral output to rise further during the current fiscal as six new mines allotted through the auction route became operational during the year and some mines closed down in the wake of a Supreme Court order would also be coming back to production,” Union Mines Secretary Balvinder Kumar said.

He added that the government was confident that mining production would increase even further, as 45 new mines would be up for auction and 17 would be up for re-bidding in the current financial year.

According to Mines Ministry officials, the consolidation of growth of the mining sector would increasingly shift from the federal government to provincial governments, as the latter had been accorded the right to auction mineral blocks.

For example, the eastern Indian province of Odisha, which auctioned the first iron-ore block a few months ago, had lined up for auction another six mineral blocks during the July to August period and another seven mineral blocks in the next financial year.

The mineral blocks up for auction over the next few months included two iron-ore, three limestone and a bauxite deposit.

To bring on board all provinces and expedite auction of mineral blocks, Mines Minister Narendra Singh Tomar met with provincial Ministers in charge of mining in their respective geographies on Friday.

Key issues up for discussion would be readiness of the provinces in conducting e-auction of major mineral blocks, the management of the District Mineral Fund, the National Mineral Exploration Fund, pan-India effectiveness in monitoring illegal mining and early adoption of information technology in administration of the mining sector.