Bauxite Beneath, Billions Beyond: How Odisha’s untapped ore is costing India the green aluminium boom

THEBUSINESSBYTES BUREAU

BHUBANESWAR, DECEMBER 15, 2025

As the global aluminium industry rides an unprecedented supercycle, propelled by the accelerating green energy transition, Odisha finds itself at the center of a paradox. The state holds more than half of India’s 1.9 billion tonnes of bauxite reserves — one of the richest endowments anywhere in the world — yet much of this wealth remains buried, immobilised by regulatory delays and environmental uncertainty. At a time when the world is scrambling not just for aluminium but for responsible aluminium, Odisha’s prolonged inaction is becoming an increasingly expensive mistake.

The spotlight sharpened in April 2025, when global mining giant Rio Tinto signed a memorandum of understanding with Mahesh Kolli-led AMG Metals & Materials (AMG M&M), part of a renewable energy group, to assess the feasibility of building a large low-carbon aluminium and alumina complex in India. The proposed project — an aluminium smelter of 1 million tonnes per annum (mtpa) alongside 2 mtpa of alumina capacity, powered entirely by renewable energy and located near a South Indian port—signals a decisive shift in global priorities. The future belongs to green supply chains, especially for electric vehicles and clean energy infrastructure.

For Odisha, the message could not be clearer. The state already hosts a mature alumina–aluminium ecosystem, globally competitive smelters, and access to skilled manpower. What it lacks today is not potential, but momentum. Its most critical raw material — bauxite — remains trapped underground while international competitors move swiftly to seize the green metal opportunity.

The Green Metal Imperative

Aluminium is the backbone of decarbonisation. From solar panel frames and wind turbine components to transmission lines and lightweight electric vehicles, the metal is indispensable to a low-carbon future. According to the International Aluminium Institute, global demand is projected to rise by nearly 80 percent by 2050 to meet climate goals. But this surge comes with a caveat: carbon-intensive aluminium will no longer suffice. Buyers increasingly demand metal produced using renewable energy and responsibly sourced raw materials.

“This is Odisha’s moment,” says Dr. Siba Mahakud, former Director of  Geological Survey of India. “Global players are looking for long-term, ethical supply partnerships. Our bauxite reserves are not just geological facts; they are tickets to future-proof investments, technology inflows and thousands of skilled jobs. Every year of delay hands over market share to countries like Australia and Guinea, which are rapidly expanding their bauxite mining capacity.”

Indeed, Guinea has emerged as the world’s largest bauxite exporter in less than a decade, largely by offering policy clarity and faster project execution. Australia, meanwhile, continues to integrate mining with renewable-powered refining. Odisha risks being left behind — not because it lacks resources, but because it has failed to unlock them.

The Human Cost of Stalled Mines

Beyond macroeconomics and global deals, the consequences of stalled bauxite mining are felt most acutely on the ground. Long-pending projects in mineral-rich regions such as Kalahandi and Rayagada symbolise more than environmental debate — they represent suspended futures.

The Eastern Ghats Bauxite Project in neighbouring Andhra Pradesh offers a telling parallel. Despite undergoing a rigorous environmental impact assessment and proposing extensive mitigation measures and community benefit schemes, the project remains mired in administrative limbo. The thousands of direct and indirect jobs once promised, the ancillary industries that could have flourished, and the development funds earmarked for local infrastructure remain unrealised.

Ironically, attitudes at the grassroots are evolving. In several mining-affected and mining-aspirant regions, resistance has given way to a more nuanced demand for inclusion. “We are not against development; we are against development that excludes us,” says a local youth leader from a potential mining belt, echoing Dr. Mahakud’s assessment. “We see refineries importing bauxite from thousands of kilometres away while our youth struggle for jobs. The solution is not a blanket ‘no’ to mining, but a firm ‘yes’ to transparent and responsible mining that makes communities real stakeholders.”

Industry Sounds the Alarm

Industry bodies have been unequivocal in their warnings. The Federation of Indian Mineral Industries (FIMI) has repeatedly pointed out the irony of alumina refineries in Odisha operating below capacity while importing expensive bauxite. This dependence not only inflates production costs but also increases the carbon footprint through long-distance logistics, eroding India’s competitiveness in a market increasingly sensitive to emissions.

At a strategic level, the contradiction is stark: India aspires to be a global manufacturing hub for electric vehicles, renewable energy equipment and green infrastructure, yet hesitates to activate the very mineral supply chains that underpin these ambitions.

A Decisive Choice Ahead

The $4 billion Rio Tinto–AMG M&M engagement is more than a headline-grabbing deal; it is a wake-up call. It underscores how swiftly capital and technology are aligning around green metals — and how unforgiving global markets can be to indecision. For Odisha, the path forward demands a calibrated but decisive approach: accelerate clearances, ensure world-class environmental safeguards, and position the state as a global benchmark for sustainable bauxite mining.

The choice is no longer theoretical. Either Odisha allows its resources to fuel economic growth elsewhere, or it harnesses them responsibly to anchor its own green industrial future. The world is buying green aluminium at a premium. Odisha has the ore, the ecosystem and the opportunity. What it needs now is action — before this moment passes, buried alongside its bauxite.