Govt mulls Rs 12,000 cr incentive for domestic mining equipment manufacturing

  • Industry News
  • Nov 25,23
A high-level committee, led by the director (technical) of Coal India (CIL), has proposed a five-year incentive program to stimulate domestic manufacturing.
Govt mulls Rs 12,000 cr incentive for domestic mining equipment manufacturing

The government is contemplating the introduction of a production linked incentive (PLI)-like scheme aimed at heavy earth moving machinery (HEMM) and underground mining equipment. A high-level committee, led by the director (technical) of Coal India Ltd (CIL), has proposed a five-year incentive program to stimulate domestic manufacturing of these crucial pieces of equipment, a significant portion of which is currently imported.

Tasked with enhancing the domestic manufacturing landscape for HEMM and underground mining equipment, including high wall miners, standard and low-capacity miners, and associated ancillary equipment, the interdisciplinary committee has submitted its final report to the coal ministry.

As part of its recommendations, the committee suggests that tenders issued by domestic coal and mineral mining companies for sourcing mining equipment should incorporate a 'make in India' clause. Standardisation of the equipment is also advised to bolster domestic manufacturing for various stakeholders, including captive and commercial mine operators, mine developers and operators, outsourcing contractors, and departmental equipment users.

In line with earlier reports, the government aims to invigorate heavy mining and construction equipment manufacturing through a proposed Rs 12,000 crore PLI scheme. This initiative seeks to reduce import dependence and generate employment in a sector integral to rapid infrastructure development.

Highlighting a commitment to diminish import reliance and promote indigenous production, the coal ministry states that these efforts align closely with the principles of Atmanirbhar Bharat, driving the Make in India campaign.

Given projections that coal will remain a primary energy source beyond 2030, the committee anticipates a substantial demand for equipment over the next decade in both opencast and underground mines. The committee comprises representatives from various government bodies, industry associations, and stakeholders.

Currently, CIL imports high-capacity equipment worth Rs 3500 crore, incurring an additional Rs 1,000 crores in customs duty. To address this, CIL has devised a strategic plan to gradually phase out imports over the next six years, aiming to stimulate the development of domestically manufactured equipment. Standardization guidelines have been issued to advance Make in India goals while reducing the breakdown period of imported equipment due to a lack of spare parts.

CIL has already initiated the procurement of HEMM and advanced continuous miners with remote supervision capabilities. Efforts are underway to promote indigenous production of HEMM, with domestic manufacturers identified for mining equipment production and technology upgrades.

In addition to this, CIL has introduced Battery Electric Vehicles (BEV) Load Haul Dump (LHD) units to enhance ventilation and cost savings. The company is committed to expanding these technologies for improved efficiency and safety.

Furthermore, CIL emphasises fostering partnerships with global equipment manufacturers and exploring the use of non-functional government infrastructure under the Make in India initiative. The coal ministry states that this initiative underscores India's potential to become a manufacturing powerhouse, aiming to create a robust ecosystem supporting innovation, empowering the workforce, and strengthening the economy.

Source: Mint

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