The astounding growth of India represents both a major opportunity and a significant challenge for the Australian mining sector and our businesses and exporters more generally.
With India's $US2.2 trillion ($3.04 trillion) economy on a rapid growth trajectory – and already considered by some to be the fastest-growing large economy in the world – there is a big shift afoot towards high-productivity sectors such as services and industry which is driving India's urbanisation.
The UN projects that India's urbanisation rate will rise to 42 per cent or 640 million by 2035, with the parallel creation of a substantial and aspirational consumer class that underpins optimism for future growth in the Indian economy.
India's steps towards liberalisation and openness in the 1980s, which accelerated in the 1990s, saw the country's GDP growth rise from an average annual rate of less than 3 per cent in the 1970s (the so-called "Hindu rate of growth") to over 7 per cent in recent years – lifting millions of people out of poverty as a result.
India's middle class is set to grow rapidly from up to 80 million today to 580 million people – or about 41 per cent of the population – by 2025.
This will drive demand for the minerals and energy resources needed to supply the construction of modern infrastructure and cities, and power homes and industry.
For example, India's demand for metallurgical coal and iron ore – both essential in making steel – is projected to double from 52 and 154 million tonnes in 2016 to over 90 and 290 million tonnes respectively in 2030.
Copper demand to build and maintain electrical wiring, manufacture of electronics, vehicles and generators is expected to grow from 511,000 tonnes in 2016 to between 1 million and 1.2 million tonnes in 2030.
And demand for other raw materials and minerals including gold and lithium will increase as economic growth, urbanisation and consumer demand shape a diversified and dynamic economy.
India will continue to attempt to meet demand for resources from domestic production.
This means further exploration will be needed to identify reserves of the range of energy and mineral resources needed to sustain growth, flexibility and diversity.
In turn, the success of this endeavour will depend on the speed and effectiveness of reforms to the minerals and mining sector to facilitate the cost-effective discovery, development and production of domestic resources.
The rise of the middle class has also fostered greater attention on the challenges of social and environmental sustainability, particularly as pressure mounts on infrastructure, services and natural resources such as water and air quality.
The level of anticipated demand growth, the scope for improvements to mining efficiency and sustainability, and the need to remove transport and infrastructure bottlenecks highlight two areas of opportunity for Australia and India.
Importing resources and energy combined with domestic supply enables flexibility across the spectrum of resources and energy commodities and cost adjustments as new technologies change the profile of demand.
The potential for Australian commodity exports to India is significant – not just in coal, gold and copper, but the inputs to renewable energy and storage technologies such as lithium and cobalt.
Reforms to India's domestic resources sector will be fundamental in improving its efficiency, removing infrastructure bottlenecks, understanding domestic prospectivity, and importantly meeting the social and environmental expectations of the community.
Australia's world-class mining equipment, technology and services (METS) sector will be an important player in Australia's part in India's future.
As the Australian mining industry has moved from a largely labour-intensive industry to a highly capital-intensive sector in recent years, many innovative transformations have been implemented across the mining and METS sector.
This transformation supports extending the productive life of mines, delivering higher yields and enabling improvements to safety and environmental outcomes.
There is greater workforce satisfaction and productivity in translating innovative ideas suggested by employees into operational improvements.
Knowledge from research institutions can be applied to implement new or improved processes and products.
And enabling access to new markets overseas – such as trade between Australia and India – can help support brand development and generate new opportunities.
Australian mining technology is exported globally and will be important in terms of Australia's future trade with India.
MCA's recent New Frontiers research report outlines good prospects for resources trade and solid engagement between Australia and India on mining-related investment, mostly based on METS.
Opportunities for the Australian minerals and METS sector will include the supply of a wide range of technologies and services by our METS firms as India's mining sector grows and modernises.
While Australia's exports to India are narrowly based, opportunities to deepen and broaden the trade in commodities and services will rely on strengthening our two-way trade and investment relationship.
Developing METS opportunities in India – our best short and medium-term opportunity for mining-related investment in India – will probably require direct investment in India.
In the medium term, India will also need to source imported resources and energy to meet the demand generated by accelerating economic growth and urbanisation – the metallurgical coal and other resources needed to build infrastructure together with the copper, cobalt, lithium and rare earth metals required for electrification and electric vehicles, renewable energy and other 21st century technologies.
Australian mining and METS has a lot to contribute to the Australia-India trade and investment relationship.
Capturing these significant opportunities will require hard work, a sensitive and careful approach and developing a deeper understanding of the complexities and challenges of doing business to support India's growth and success.