The Curious Case of Vedanta Sterlite Copper : How the closure of a national asset made India a net copper importer
However, the plant, which had been operational for over 22 years and played an important role in the nation’s copper production and industrial growth, was closed in 2018. The Vedanta Sterlite Copper plant news regarding its closure sparked significant debate and concern across various sectors, including economic and manufacturing sectors. Also, the closure has left its mark on India’s copper supply chain and broader industrial landscape by making the nation a net exporter of copper.
Through this blog, we aim to shed
light on the ongoing developments surrounding the Vedanta Tuticorin Plant and the potential consequences
for India’s economy.
All About Vedanta’s Sterlite Copper Plant News
Many activists and local communities raised alarms about the plant's impact on air and water quality, which caused protests and, ultimately, the closure of the plant by the Tamil Nadu government in 2018.
The closure has sparked debates over the balance between industrialisation and environmental protection, especially when the plant meets India’s copper demand.
The Economic Impact of the
Sterlite Copper Plant Closure
The closure of Vedanta Thoothukudi has impacted the lives of many. The decision has resulted in the loss of more than 1,500 direct jobs and over 40,000 indirect jobs, mainly affected due to the shutdown of the plant, which is much more prominent in the Indian economy. Apart from the job loss of thousands, the plant's closure has also made India a net importer of copper.
Indeed, the closure of the Vedanta Sterlite Copper plant has impacted the country’s copper trade significantly. India, from being one of the top five exporters of copper cathodes in 2017-2018, has now started importing copper. The plant accounted for roughly 40% of the country’s copper needs as the smelter produced nearly 4 lakh tonnes annually. Before the plant's closure, India exported around half of the copper, but post the plant’s closure, the country's copper exports fell by 70%.
Vedanta Transparent Approach
Though the decision has raised concerns over potential environmental risks, particularly related to the Vedanta Sterlite copper plant, the company remains committed to taking all necessary precautions towards environment protection. Mentioned below are some of the achievements that demonstrate the company’s commitment to sustainable development
- Sterlite Copper adopts and maintains global best practices on carbon
and energy management and minimising greenhouse gas emissions throughout
its operations.
- Reporting carbon emissions in compliance with internationally recognised protocols and working closely with other stakeholders to reduce energy consumption and carbon intensity.
- Foster research and innovative techniques within its operations to
ensure optimal utilisation of resources.
- Invest in clean energy and maximise benefits from energy through
waste recovery. Provide adaptation and future-proofing of its facilities .
- Consider carbon emissions for its project and R&D investments
aligned with Vedanta Resources' sustainable development commitments.
These achievements are a testament to Vedanta’s sustainability approach, which is driven by its vision to save the environment from all sorts of potential threats. With increasing pressure to minimize carbon footprint and follow environmentally responsible practices to meet consumers’ demand, prestigious companies like Vedanta have adopted more resilient and sustainable logistics systems.
Regarding the Vedanta Sterlite copper plant, the group has filed multiple petitions, stating that the closure was unjust and that the plant has always adhered to environmental norms. Currently, the case remains under legal scrutiny, with Vedanta seeking to reopen the plant, citing its essential role in meeting the country’s demand for copper.
Challenges for India’s Industrial
Future
Moving ahead, the closure of Vedanta Thoothukudi Copper plant will continue posing significant challenges for India’s industrial sector. The situation is expected to worsen due to the surging demand for copper and rapid growth in several industries that use copper. The Ministry of Mines of the Government of India has identified Copper as a Critical Mineral, highlighting its importance in the global energy transition. This makes the domestic production of copper imperative. According to the estimates, copper demand is expected to increase by over 9.3% annually, reaching around 2.5 to 3.5 million metric tons by 2030. These key driving factors accelerating the copper demand include increasing requirements from several industries, including renewable energy, electric vehicles, power grid expansion, and rapid urbanisation etc.
As part of the Modi government’s push for solar energy, India will require almost 1.5 million tonnes of copper by 2030 for solar and wind energy. Since copper is essential in producing and transmitting electricity, as it is used in equipment like alternators and transformers, India needs more copper producers, like the Vedanta Sterlite copper plant, to meet the growing demand.
Conclusion
Indeed, Vedanta’s Sterlite copper plant was one of the main contributors of copper in India, meeting up to 40% of the country's copper demand. The sudden closure of Vedanta Tuticorin Plant impacted the lives of thousands of workers, their families and downstream industries and had a far-reaching impact on India’s industrial future.
In the business world, where companies are still uncertain about growth and expansion, companies like Vedanta Group invest billions of dollars nationally and internationally to expand their operations while contributing to a greener world. Thus, resolving the Sterlite Copper plant dispute is crucial for securing India’s future economic stability and industrial development.
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