India is third-largest producer of coal with a production of 557.7 million tonnes (MT) in FY13. It has the fifth-largest coal reserves in the world at 60.6 billion tonnes (BT). The country is expected to become the second-largest steel producer by 2015. Crude steel production increased at a compound annual growth rate (CAGR) of 6 per cent over 2008-2013 to 73.3 million metric tonnes (MMT).
The metal and mining industry of India has recorded a strong 19.8 per cent expansion in 2011 to touch US$ 141.9 billion. Production volumes have also been growing steadily over the years - during the period 2007-2011, it registered a CAGR of 5.2 per cent.
The Government of India has allowed 100 per cent foreign direct investment (FDI) in the mining sector under the automatic route. Mining lease has been granted for a long duration of minimum 20 years and up to 30 years. It has also approved MMDR Bill (2011) to provide better legislative environment for investment and technology.
There is significant scope for new mining capacities in iron ore, bauxite, and coal. Untapped metal reserves in India are to the tune of 82 BT. Strong long-term demand from the steel industry is expected to further boost the iron ore industry. Increasing power production is likely to catapult demand for coal. Booming construction, automobiles, and packaging industries are expected to lend substantial support to the metals and mining sector.