MECL begins gold mining in Kolar after 16 years
The Mineral Exploration Corporation Limited recently began the Kolar Gold Field exploration after 16 years.
Background
The Kolar Gold mines are located nearly 100 km from Bengaluru. They were closed in 2001 due to the fall in gold prices. The pyroclastic and pillow lava at the mines were declared as a National Geological Monument by the Geological Survey of India. This was done for the protection, maintenance and encouragement of Geo-Tourism.
The power generation units in Shivanasamudra, Mandya were built to support the mining operations in 1889. The Kolar Gold mines were nationalized in 1956. The mining operations were closed by the Union Government in 2001 citing the production did not justify the investment.
Gold Reserves in India
Karantaka is the largest producer of gold in India. Kolar gold mines of Karnataka is one of the deepest mines in the world. Mponeng Gold Mines of South Africa is the deepest gold mine in the world.
Andhra Pradesh of the second largest producer of gold in India. Ramagiri, Anantpur of Andhra Pradesh is the most important gold field in Andhra Pradesh.
According to the World Gold Council, India has the 10th largest gold reserves in the world with more than 600 tonnes. US has the highest gold reserves in the world (8,133 tonnes) followed by Germany (3,366 tonnes). The International Monetary Fund alone holds 2,451 tonnes of gold.
Gold Imports and Exports
India imported 11.5 billion USD of gold in 2019-20. India is the largest importer of gold in the world. Gold imports in India is one of the main reasons of Current Account Deficit.
Current Account Deficit
It is the measurement of a country’s trade where the value of goods and services of its imports exceeds the exports.
Gold Vs Currency
The value of a country’s currency is tied to the value of its imports and exports. When the imports of the country are greater, the value of its currency decreases. Thus, imports of gold in India has a major role towards depreciation of Indian rupees.
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Month: Current Affairs - September, 2020