Mining ban in Goa

Mining ban in Goa

Iron ore mining has been banned in Goa leading to an annihilation of the economy in that part of Goa. Was it worth it? I would say yes!  The way things go in India the required systems that can force firms to behave on the environmental front, on the rehabilitation front, and generally be good neighbors to surrounding communities, do not exist.  Whether by public or private firms, mining is typically harmful to local communities from what I have seen across India.  The benefits go to larger communities (nations, economy, firms) but the costs are borne by the locals.   Therefore putting systems in place that enforce good behavior by mining companies and governments need to be a precondition for any mining – whether it is sand and stones, or iron and coal.

Regulation is the wrong way to control firms.  For one, regulators are not very different from bureaucrats in their instinct (and mostly are ex-bureaucrats).  Two, they are as susceptible to corruption as politicians.  And three, it will be difficult to align their interests with those of local communities.

Markets are also clearly not working in this domain, and that’s the root cause of the problem.


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