Andhra Pradesh’s next leap: From mineral wealth to manufacturing power

Andhra Pradesh is looking beyond mining. The State is seeking to transform its abundant mineral wealth into a manufacturing opportunity, moving beyond the extraction of raw materials to create greater value within the State.

With significant reserves and deposits of gold, titanium, coal, steel, lithium, gallium and other minerals, Andhra Pradesh is positioning itself to move up the value chain. The objective, according to senior government officials, is straightforward: not merely to extract and sell what lies beneath the ground, but to process, manufacture and build industries around these resources within the State.

This emerging “minerals-to-manufacturing” strategy has already begun to take shape with the production of gold bars from the Swarnagiri Gold Mines near Jonnagiri in Kurnool district, operated by Geomysore Services India Pvt. Ltd.

The success of the Swarnagiri project is encouraging the State Government to look beyond a single mine and explore the potential of other gold-bearing regions as well. According to information available from the government, Geomysore commenced production a couple of months ago and is expected to produce around 1,000 kg of gold annually in the coming period, with the capacity likely to increase further as operations expand.

The significance of the development goes beyond the gold extracted from the mine. Gold production, bullion manufacturing and, potentially, jewellery-making clusters can create an integrated value chain within Andhra Pradesh — generating employment, supporting ancillary industries and retaining a larger share of the economic value of the mineral within the State.

With a broader industrial vision, Andhra Pradesh wants its mineral wealth to become the foundation for manufacturing, rather than simply a commodity leaving the State as raw material.

The development could mark the beginning of a broader gold-based industrial ecosystem in the region. Geomysore is already operating in over 600 acres and has sought an additional 1,000 acres for exploration. The proposal currently under active consideration by the Andhra Pradesh Industrial Infrastructure Corporation (APIIC). The State Government is also identifying additional sites suitable for gold exploration.

According to Principal Secretary, Revenue (Mines), Mukesh Kumar Meena, several promising gold-bearing belts are also being prepared for auction.

“Boksampalli, Javakula, Chigurugunta and Ramagiri belts of Anantapur and Chittoor mines will also be auctioned shortly. And these mines will have better yield, upto 5.6 grams gold plus per tonne. The government is also planning to facilitate gold ornament manufacturing clusters close to the mines,” Mr. Meena said.

The vision extends beyond mining. Gold jewellery and ornament-manufacturing clusters located close to the mines could create an integrated value chain — from extraction and refining to bullion, jewellery manufacturing and marketing — while generating employment and supporting ancillary industries.

For Andhra Pradesh, the benefits could also extend to government revenues through GST and mining royalties, while increased domestic gold production has the potential to reduce the country’s dependence on imported gold and save valuable foreign exchange.

Another potentially transformative project is the proposed Reliance Industries coal-gasification project near Recherla and Chintalapudi in Eluru district. With a proposed investment of more than ₹2 lakh crore, the project envisages an integrated industrial complex spread across approximately 8,000 acres.

The underground coal-gasification process could convert the deep coal reserves into syngas and other feedstocks, supporting the production of hydrogen, ammonia, urea, methanol, synthetic natural gas and liquid fuels such as diesel.

The project could therefore go well beyond coal utilisation, potentially serving as the foundation for a large chemicals, fertiliser, energy and downstream industrial ecosystem in the region.

“The coal gasification project here will be a clean one, operated 600 meters underground. The beauty of the project is that it will facilitate several ancillary industries which will have high potential for thousands of jobs,” explained Mr. Meena.

If successfully implemented at scale, the project could transform the Eluru–Chintalapudi–Recherla belt into a major industrial and energy hub, with opportunities extending well beyond the core gasification facility into fertilisers, chemicals, energy, engineering, logistics and other ancillary industries, he added.

On the east coast of Andhra Pradesh at Srikakulam, Adani Group has proposed a ₹16,000 crore beach sand project for Titanium extraction, processing and manufacturing of value-added products. Early this month, Adani Ports & SEZ MD Karan Adani met Chief Minister N. Chandrababu Naidu in this regard. The project is expected to create a broader mineral-processing ecosystem in Andhra Pradesh.

Meanwhile, a preliminary study conducted by the National Geophysical Research Institute (NGRI) has identified traces of lithium and gallium in Tummalapalle, Kadapa district. To take the initiative forward, the Andhra Pradesh Mines Department has signed an MoU with NGRI and IIT Dhanbad. The government plans to explore the potential of these critical minerals for manufacturing lithium batteries and components used in semiconductors, satellites and other advanced electronic applications. According to government sources, IIT Dhanbad’s proposed Centre of Excellence in Andhra Pradesh will focus on research, product development and manufacturing in this emerging sector.