The already severely strained economy of Goa is creaking with the additional weight of the impact of the coronavirus outbreak across the world in general and in the state in particular. Today, the gravity and extent of the challenging circumstance can be gauged by the fact that the total state debt is rearing its ugly head at Rs 20,000 crore with an additional incubus of Rs 7,000 crore revenue loss for the last two years because of mining stoppage. It may be recalled that mining activity in the state had stopped in its tracks two years back on March 15, 2018, after the Supreme Court quashed 88 mining leases.

With the coronavirus pandemic stated to massively and critically negatively impact over four crore tourism jobs in India, economies of states such as Goa which depend heavily on the tourism industry for livelihoods are staring at a very dark and bleak future. The tourism sector in Goa is already estimating huge losses with a disappearing of 60-75,000 jobs right away and incremental erosions of secondary and tertiary employment in the months to come. This will lead to additional losses for the state and unemployment. Since tourism and mining constitute the two main livelihood and fiscally leverageable opportunities for Goa, fatal harm to both spells irrevocable doom to the state as a whole. In such a situation, mining activities need to restart at all costs and immediately.

It is a sad turn of events that has put the double setback of these twin afflictions on the innocent and helpless victims who are the citizens of Goa. While the disease will take its time to pass and the contingent threat will gradually mitigate, by taking urgent steps to restart mining, a modicum of relief may be on priority made available to the people of Goa. As an additional tragic impact of the disease outbreak, temporary closure of several other industries due to the pandemic may warrant further allowances/doles to those sections of the citizenry who have no remaining sources of income. This cumulatively augurs ill for Goa if nothing is done soon. In the current scenario, resumption of mining activities is the only quantifiable solution that can buttress the economic condition of Goans along with the financial health of the state. The mining dependents as well all of Goa are in a very serious financial crunch undoubtedly.

We are currently at a point in time where the worst is yet to come. Factoring in the long tail of recovery, as and when that happens, tourism will definitely be a late surge. Since Europe is the epicenter of the pandemic now, tour arrivals from this once-lucrative market can be expected to remain dormant for a quarter at least. Add to this, the practically complete cessation of domestic travel and the state of the Indian disease control setup, the country’s tourism and hospitality sector will suffer, in all likelihood, a huge hit for the remainder of the current fiscal.

While it is true that the government has allowed limited transportation of ore in Goa for a period of six months, a realistic appraisal belies any perceptible gains from this step. With the onset of monsoons just around the corner, transport activities will have to be brought to a stop. Also, the social distancing measures correctly advised by the government could additionally affect the transportation scene within this six-month period. In any case, looking at this from any perspective, it is clear the transportation concession will not yield any substantive or enduring relief to the economic and livelihood challenges of the beleaguered state of Goa.

What is then to be done? Looking at the demand side economics in this case, there is both a compelling market opportunity and an enabling ecosystem available to tap into it. Traditionally, mining in Goa has been far east driven and in this single factor may lie the sole source for Goa’s fiscal sustenance and economic redemption in the context of mining restart. Since China is on the path to recovery, the reasonable expectation of market experts is that industrial demand will soon pick up and consequently the demand for low-grade iron ore from Goa shall also witness an uptick.

The reasons are—even South Korea and Japan are recovering relatively faster and secondly, would seem more acceptable and have been Goan markets for long. The opportunity, therefore, is ripe for restarting mining operations and boosting the state’s economy and India’s forex kitty along with providing employment and viable livelihoods to the 3,00,000 impoverished mining dependents in the state.

The mining ban in Goa has had far-reaching and deeply disturbing socio-economic impacts. Earlier, pre-ban, mining contributed 25 percent to the state economy. Today, after the ban, the contribution is nil. According to the Centre for Monitoring of Indian Economy (CMIE), Goa is witnessing its worst phase in terms of employment generation, and the rate of unemployment of the state is at 34.5 percent which is the highest in the country. As a result of the mining ban, the livelihoods of more than 30 percent of the state’s population have gone. The larger network effect has resulted in lakhs of other job losses. Restarting mining will help Goa mitigate the damage of COVID-19 and get its people on the road to recovery.

—Ambar Timblo is Managing Director, Fomento Resources and presently the President of Goa Mineral Ore Exporters’ Association. The views expressed are personal

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First Published:Jul 9, 2020 6:07 PM IST