The Majhgawan mine, located near Panna in Madhya Pradesh, has recommenced operations after overcoming environmental and regulatory hurdles. This site, managed by the National Mineral Development Corporation (NMDC), stands out as India’s only mechanised diamond mine. Its operations, resumed on March 11, had been previously suspended due to lapses in environmental clearances related to the proximity of the Panna Tiger Reserve.
The Majhgawan mine, located near Panna in Madhya Pradesh, has recommenced operations after overcoming environmental and regulatory hurdles. This site, managed by the National Mineral Development Corporation (NMDC), stands out as India’s only mechanised diamond mine. Its operations, resumed on March 11, had been previously suspended due to lapses in environmental clearances related to the proximity of the Panna Tiger Reserve.
Historical Overview
Initiating commercial production in 1971, the Majhgawan-Panna mining project has experienced irregular operational pauses, with a notable halt in activities at the end of 2020. Managed by Rio Tinto until 2017, the project has been subject to environmental concerns, leading to periodic suspensions of mining operations over the past fifty years.
Resumption Strategy
With the necessary approvals now in place, NMDC’s initial focus will be on removing the overburden, a process expected to last about a year. This phase might allow for limited diamond production from existing stockpiles. Officials plan to incrementally increase the mine’s output, aiming for a production target of 40,000 carats annually within the next two to three years, post-expansion of the mine pit.
Amitava Mukherjee, acting Chairman and Managing Director and Director (Finance) of NMDC, stated during an analyst conference call, “But now for one year, we have to do waste mining. One year we do not expect any diamond to be found. Because the one year waste mining in Panna is generally not a very profitable venture for us. But it is our oldest mine, the only mine…. so it is like the diamond on the crown.” He further noted, “Once we start producing it will come on drastically, but it will not be a money spiller for us.”
Financial and Production Details
In FY2021, the mine’s production was recorded at 13,681 carats. Despite no production in FY22, there were sales from stockpiles amounting to 25,219 carats, valued at ₹62.93 crore. No production was reported in FY23 and the first 11 months of FY24, with financial losses for the diamond mining project reaching approximately ₹50 crore for the first nine months.
Implications for the Jewellery Industry
The reopening of the Majhgawan mine is noteworthy for the jewellery sector, indicating an upcoming increase in the domestic supply of diamonds. The phased production increase and NMDC’s exploration activities, including a prospecting license in the Baloda–Belmundi block in Chhattisgarh and extensive drilling in several other blocks, reflect a commitment to enhancing India’s diamond mining sector.
