The Mineral Industry of India 
By Gordon L. Kinney' and Francis E. Shafer2 
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 The mineral industry of India was an important factor to the economy. It
accOunted for about 1.5% of India's gross national product(GNP) in 1978 and
employed about 4% of the organized labor force. Downstream employment depending
directly on domestic mineral output was several times that figure, and included
the steel, aluminum, copper, and zinc producers and their associated heavy
manufacturing, transportation, and rural electric power development sectors.

 Continuing exploration efforts conducted or supported by the Government-owned
Geological Survey of India (GSI), Mineral ~Exploration Corp. (MEC), National
Mineral Development Corp. (NMDC), Oil and Natural Gas Commission (ONGC),
and the various State mineral development corporations, added significantly
to the mineral reserves picture of the country. India has large proved and
indicated reserves of bauxite, iron ore, mica, manganese, chromite, barite,
heavy mineral sands, and coal. Offshore exploration drilling during 1978-79
confirmed additional reserves of petroleum and natural gas. 
 In December 1978 there were approximately 2,100 active nonfuel mines in
India that were large enough to be required to report to the Government.
Nearly 500 were producers of 10 different metallic ores and the remainder
produced a total of 36 different nonmetallic minerals. 
 Overall, the private sector employed over 120,000 persons in mining, while
the public sector accounted for over 760,000.~ 
 The Indian economy had a relatively good year in 1978. The GNP increased
approximately 4.0% in 1978-79~ to $66.4 billion.~ Conditions took a turn
for the worse, however, in 1979 and the GNP was expected to decline about
3% in 1979-80 to about $64.4 billion.6 At current prices the GNP was 
$109 billion in 1977-78, $117 billion in 1978- 
79, and estimated at $131 billion in 1979-80.~ The poor performance of the
economy during 1979 was caused by several factors. The most important was
the lower than normal rainfall in the southwest whiöh brought drought
conditions to much of the country and a large decrease in the amount of power
normally generated by the hydroelectric plants. The food grain harvest in
1979 was estimated at 16 million tons less than in the previous record high
year. Other factors affecting the economy were the loss of industrial production
from severe electric power shortages, scarcity of industrial raw materials,
transportation and port bottlenecks, and labor unrest. 
 The $1.7 billion budget deficit initially projected in February 1979 climbed
during the year and almost doubled to $3.3 billion. Drought relief and welfare
expenditures, cost-of-living allowances for government employees and increased
cost of crude oil were the major contributors to the expanding deficit. 
 A sharp inflationary trend developed early in 1979 and continued through
the summer. Prices were driven upward by the projected budget deficit; a
sharp increase in the money supply; increased taxes; higher cement, steel,
and petroleum prices; and anticipation of a poor harvest following the lower
than normal rainfall. Wholesale prices were increasing at a 25% annual rate
in March 1979, then settled down and finished with a net increase of about
16.4% for 
1979-80. 
 In 1979-80, for the first time in recent years, India's industrial production
growth rate was zero, compared with a 7.6% increase in 1978-79. 
 Production of electric power totaled 103 billion kilowatt-hours in 1978-79,
a 12% increase over the 92 billion kilowatt-hours