Page 25 - Insurance Times September 2021

also be done adequately for the better documentation and done. This impacts the speed, accuracy, dependency
training wherever needed. and also the cost to the company in providing them
extra medical facility. While the ageing people may
Challenges Associated with Mining have deep knowledge of the mines and mining but they
are not used to the modern technologies used in the
Industry: field and this may hamper the production process. Less
While there is risk in the sector, the mining industry is trying number or talents joining and more workers are
to manoeuvre and clear of the headwinds that are coming retiring, makes the company to ask more from the less
as a challenge to keep the industry in profit and intact. From and which leads to physical stress on the workers.
volatility in the market demand to the scarcity of resources, Growing demand is just adding to this challenge.
the challenges faced by the industry has kept them thinking
Y Capital: Access and allocation of capital is the major
of the future prospects.
issue in this sector. The production and equipment is
As, everything we use in our office, home, schools etc. are getting expensive with time but the capital to raise
those are not sufficient. Hence, the companies are
somewhere related to the mines and minerals extracted
from it. But, in recent times due to some changes in the forced to merge with the smaller companies where the
surrounding the extractions of minerals is also changing like not so trained people get the responsibility of arranging
the environmental issue, limitless increase in urbanization, capital to save the company from loss and have some
seismic shifts in the technology which eventually is profit margin. Flexible finance has become so popular
pressurising the industry in significant ways. that it saved so many companies from shutting down
as the investor are nervous in investing in high risks
The sector we rely upon for so many things from energy to projects. The ongoing rapid expansion of middle class
the kitchen utensils has to come with a fair share of in the counties like India, China, parts of South America
challenges. These challenges can be taken over only when etc., continue to fuel this voracious demand of these
we have the idea of what these are and the gravity it has. commodities.
So, let us look few of them in detail: Y Price Volatility: This challenge makes it extremely
Y Energy: The very characteristic of mining industry is difficult for the companies to plan its income and
that many of the operations will be done in the remote expenditure. Significant amount of projects are started
areas and inhospitable places. Hence, building in the boom years, but before the project reaches its
permanent power grids is not feasible to the pocket and production capability the market goes down. The
the already scarce resources there. To solve this issue current geopolitical trend has forced so many companies
many companies are now using micro off grid to stop their production. This uncertainty in market is
technology rather than traditional power generation not suitable for such high scale industry where it is not
techniques which is less expensive. Power rental is also easy to adjust with the trends. Companies have to cut
an option to overcome this challenge. down operations or reduce its workforce to meet is
Moving to renewable energy sources would be helpful, expense and does not make a loss in the market.
but the technology and environmental conditions Y Displacement and Rehabilitation: With new projects
becomes constraint at few sites. For this, we need to are taken up, more land is being encroached upon and
adopt new technology and try to capture the energy more people have to leave their home just to make way
and control the grid. for such projects. This large scale displacement leads

Y Health and Safety: Mining industry is always weighed to local people's grievances and improper rehabilitation
by minerals on one hand and the risk associated with on further leading to alienation and people's distrust on the
the other. As mines get deeper, the danger of collapse government. It is not just loss of land rather the loss of
increases. Also, with the temperature change in the mine their way of life which is tribal in nature, their culture
the working condition can prove to be fatal. Hence, and rich traditions. It has made way for left wing
proper ventilation and temperature control technique extremism in the resource rich areas like Chhattisgarh,
has to be deployed for the safety of the miners'. Jharkhand, Odisha, West Bengal etc.

Y Talent Shortage: As the industry is failing to attract the Y Human Rights violation: Mining related deaths,
young blood due to the safety concerns, the mining inadequate rehabilitation, and rudimentary ways of
industry is getting ageing population to get the work mining adopted without any protective gears or

The Insurance Times, September 2021 25