Mining For Prosperity

The development of industries in Nepal has been held back due to their reliance on the imported raw materials such as iron and steel. Now, however, there is an excellent chance to put that history aside with the new success at the iron ore site of Dhaubadi. Having already issued contracts for the mining scheme in two major blocks, conducted a chemical analysis, and started the Detailed Project Report (DPR), the project has finally begun to turn rhetoric into reality. This is a bit of optimism that the country's natural resources can be converted into wealth. Preliminary calculations show that there are about 100 million tonnes of iron ore deposits, and the latter calculations show the reserves of 126.76 million tonnes of haematite ore.

       As per a news report published in this daily on Tuesday, the Pokhari block and the Ratekhola block have 7.3 million tonnes and 18 million tonnes of ore each. There is geological evidence showing iron of 17 to 58 per cent with an average metallurgical grade of 35 per cent. In case of implementation, the project costing around Rs. 51.25 billion (US$394.2 million) will earn profits amounting to US$391 million and a net profit of US$29 million, meeting almost one-fourth of the yearly requirement of iron in Nepal, which would cross 2 million tonnes. These figures indicate the significance of the project, but numbers alone do not ensure success. The country has been facing hurdles in the progress of various infrastructure and industrial projects due to policy inconsistencies, delays caused by bureaucracy, and political interventions. 

Though past problems related to the DPR process for multiple years have apparently been sorted out, the progress of the project in the future must not be affected by other factors. Since commercial production is scheduled to start in early 2030, all phases of this project have to move according to an established and accountable schedule. Another aspect that needs to be considered equally is environmental responsibility. It is encouraging that the project can be referred to as “zero waste” because it intends to use the by-products such as silica, quartzite, construction aggregates and produce 70 megawatts of power. But such claims need to be verified through environmental assessment and monitoring, as mining is an activity that inevitably changes ecosystems and impacts the lives of people living in their vicinity. It is promising that the government once again decided to lower its stake in the project and invited private companies to invest via the PPP model. 

Without proper regulation, the national resources may get threatened by the interests of short-term business. The government has to ensure that it stays vigilant for safeguarding the national resources as well as encouraging professionalism. For the welfare of national development, it is high time that no further strategic resources lie underneath the decisions of administration. The current project reflects the ability of the nation to develop industrially, cut down its imports, provide job opportunities and create sustainability. All this needs transparency, scientific planning, ecological soundness and determination from the politicians. With all this consideration for each of the decisions made, the Dhaubadi iron mine project will be a turning point in Nepal's industrial development.