MAC: Mines and Communities

A famous battle is won - now to end the war!

Published by MAC on 2010-08-30
Source: The Hindu, Times of India, statements, and others

India's environment ministry damns Vedanta's Nyamgiri mine

It wasn't a foregone conclusion.

However, following the unequivocal high-level condemnation of Vedanta's proposed bauxite mining of the Nyamgiri hills in Orissa, a fortnight back, it would have been surprising had India's environment minister not halted the project in mid-stream. See: Indian government committee condemns Vedanta's proposed Nyamgiri mine 

It's also little wonder that both domestic and international media made a great deal of this victory. The issue has proved to be one of the most contentious of its kind anywhere, during recent years.

But we may ask whether this really was a "David versus Goliath" battle, as portrayed by some - and whether the struggle is over?

The environment ministry (MoEF)'s withdrawal of the project's earlier, fraudulent, "forest clearance" won't prevent Vedanta and its accomplice, the Orissa Mining Corporation, sourcing bauxite from elsewhere to feed its nearby Lanjigarh refinery.

Indeed, the company has been doing this for the past five years, although it is not clear from which mines and whether they themselves may be operating legally.

Even were Vedanta punished for its numerous recorded offences, it is likely to escape with a fine. There is virtually no prospect that the central government would close down the Lanjigarh plant, however egregious its violations.

The UK-based Vedanta is India's most diversified mining outfit. It has some powerful friends in Delhi - not least the present home minister, P Chidambaram. See: London Calling probes the home affairs of an Indian minister 

And, when Vedanta's head honcho Anil Agarwal proclaims his intention to make it the world's leading miner (as he often does), he  strikes a highly favourable chord with many in government. 

Serial offending

Just after Vedanta was accepted onto the London Stock Exchange in late 2003, we listed numerous examples of its already unacceptable modus operandi. See: London Calling Special

That was before the company had proceeded with construction of its parlous Orissa refinery, and the related Jharsuguda aluminium smelter.

It was before Vedanta embarked on the huge extension of its highly polluting Tuticorin copper smelter in Tamil Nadu, and a compatible expansion of its the Balco aluminium  complex in Chhattisgarh.

It pre-dated the company's acquisition of Goa's leading iron ore enterprise, Sesa Goa.

Not one of these operations has escaped compelling accusations of falling outside the law.

Barely two months ago a top official of Vedanta's subsidiary, Sterlite, was sent to jail for tax evasion. See: Anti-Vedanta activism hits the spotlight in Tamil Nadu

Three top Balco executives were also arrested last year, charged with culpable homicide following the deaths of at least 42 contract workers in Chhattisgarh. See:Vedanta officials charged with culpable homicide over Indian disaster

The evidence is overwhelming, and it grows almost by the month: Vedanta is a serial offender; its presence is a direct threat to many thousands of people, and an intrinsic liability for India's environment as a whole.

In 2007, alone among investors at the time, the Norwegian government concluded that Vedanta as a corporate enterprise showed no sign of behaving itself now or in the future. Norway's central bank therefore disinvested all its Vedanta shares.

It took another two years before any other major investors followed suit. They did so when evidence of Mr Agarwal's shabby and shady exploits in Lanjigarh grew too compelling to ignore.

Many more challenges

Undoubtedly, last week's ruling by the MoEF would not have occurred without the painstaking efforts of Indian organisations, a small group of lawyers and their consultants, a few international NGOs - and above all the dogged resistance of Lanjigarh's Dongaria Khond and Dalit communities.

But it would be a pyrrhic victory were these combined forces now to disperse, leaving Vedanta's Lanjigarh refinery still free to operate; failing to halt the company's encroachment on other bauxite hills; and ignoring the impacts of a major expansion of its Jharsuguda smelter.

And that's taking account only the company's malevolent presence in Orissa.

Almost exactly a year ago, when India's new Minister of Environment and Forests was getting into his stride, we warned that it was "far too soon to claim that a new wind is blowing through the land". See: Is a new wind blowing through India´s village and hills? It´s still too early to tell

That wind might have blown away the Nyamgiri mine. It hasn't yet affected a large number of other projects - and not only ones in the Vedanta camp, but also those of other companies, such as Posco, Jindal, Reliance, Essar and Tata.

It will require far more application, activism, and diligent observance of the rights of India's poorest peoples, before we can proclaim the land itself to be safe.

[Commentary by Nostromo Research, 29 August 2010]

Vedanta Mining Project in Orissa's Niyamgiri Hills Rejected

Press Release

Indian Ministry of Environment and Forests(MoEF)


24 August 2010

The Ministry of Environment and Forests rejected Vedanta mining project in Orissa's Niyamgiri Hills. Talking to reporters here today, Minister of State for Environment and Forests Shri Jairam Ramesh said that the Vedanta Resources has violated laws and the Niyamgiri Hills project cannot be given the go ahead unless the Forest Act is complied with.

"There has been a very serious violation of laws. There has been violation of the Forest Rights Act, 2006, Environment Protection Act, 1966 and Forest Conservation Act, 1980. Therefore, the project cannot go ahead," he added.

A statement issued today says, "The stage II forest clearance for the Orissa Mining Corporation Ltd.(OMC) and Sterlite bauxite mining project on Niyamgiri Hills in Lanjigarh, Kalahandi and Rayagada districts of Orissa cannot be granted. Stage II Forest Clearance therefore stands rejected. Since the forest clearance is being rejected, the environmental clearance for this mine is inoperable."

The Minister informed that government is examining penal action against Vedanta and is also mulling to issue a show cause notice for illegal mining.

A four member committee, set up by the Environment Ministry headed by Shri N C Saxena, a National Advisory Council member early this year, investigated alleged violations of environmental laws and submitted its report last week had also advised rejection of the mining project, saying it would endanger the survival of tribals living in the project area.

Further commenting on the Korean company POSCO's steel plant in Orissa, Shri Ramesh said that the government has asked Gupta panel to submit its report by September-end.

He also added that it is unfair to compare Vedanta with POSCO projects.

Govt examining penal action against Vedanta

24 August 2010

Orissa Chief Minister Naveen Patnaik's plea fell to the deaf ears of central government even after PM Manmohan Singh assured that matters regarding Vedanta and POSCO will be expedited.

Environment Minister Jairam Ramesh has rejected stage II forest nod for Vedanta's bauxite mining project in Niyamgiri Hills (Orissa) saying that the project clearance is ‘inoperable', reports CNBC-TV18.

Going by the NC Saxena report, the centre has decided to go strict with Vedanta. Ramesh informed that government is examining penal action against Vedanta and is also mulling to issue a show cause notice for illegal mining.

Earlier, four member panel headed by NC Saxena, a National Advisory Council member said that UK-based mining group Vedanta should not be given permission for bauxite mining in Orissa. According to the panel, the bauxite mining of Vedanta in Orissa violates Forest Conservation Act and deprieves two primitive tribal groups of their rights

The move comes as a big blow for Vedanta as its subsidiary Vedanta Aluminum had applied for the Niyamgiri bauxite mines to feed its alumina refinery. Sterlite owns 29% of Vedanta Aluminum and the rest by Vedanta.

Vedanta has 1.4mtpa alumina refinery in Lanjigarh (fully commissioned). The company recently got approval to expand its refinery capacity from 1mt to 6mtpa.

However the silver lining lies here is that Vedanta can force the state government to allocate other sources of bauxite. As per its memorandum of understanding (MoU) with the state government, it is entitled to 150mt of bauxite resources.

Further commenting on the Korean company POSCO's 12 million tonne steel plant in Orissa, Ramesh said that the government has asked Gupta panel to submit its report by September-end. He also added that it is unfair to compare Vedanta with POSCO projects.

Flouting rules may invite prison term

By Chetan Chauhan

Hindustan Times

26 August 2010

The government might soon change the Environment Protection Act (EPA) to make "non-compliance" of environment conditions a non-bailable offence, with penalty proportionate to the offence. This comes after Environment and Forest Minister Jairam Ramesh's decision to reject the clearance for bauxite mining for Vedanta Resources' aluminium refinery in Lanjigarh and issued a showcause notice for violating environment clearance conditions by getting bauxite from 11 illegal mines in Jharkhand.

Under the existing provisions of the EPA, the ministry can cancel the environment clearance and impose a penalty of up to Rs 1 lakh [100,000 rupees] and a jail term of up to five years for not complying with the environment clearance conditions.

However, the penalty is rarely imposed as the process involved is so cumbersome and time-consuming that it makes the law neither a deterrent or punitive enough, a committee headed by the ministry's additional secretary J M Mauskar said in its report to Ramesh.

A ministry committee has recommended that the quantum of penalty for non-compliance of the environment clearance conditions could be made sufficiently high and there may not be any ceiling on the quantum of penalty for serious offences.

According to ministry officials, the committee wants the penalty to be proportionate to the violation of the clearance condition.

"The bigger the violation, the higher should be the penalty," an official said.

"The serious offences may be cognisable by police and non-bailable," the committee has recommended.

The committee has also asked the ministry to change the law to make imposing penalty a swifter and prompt exercise.

Goa has used satellite imagery for effective implementation of coastal regulations and the committee wants similar mechanism for polluting monitoring and encroachments.

The committee also said that clearance should be classified into four levels for effective monitoring.

Vedanta, State govt. officials were in 'active collusion'

The Hindu

25 August 2010

N. C. Saxena, whose report formed the basis for rejection of Vedanta's proposed mining project in Orissa, on Tuesday said the State government and the company officials were in "active collusion" in violating a series of forest laws at the site.

Mr. Saxena, who has been under attack from Orissa government for giving "biased" recommendations during his visit to investigate the alleged violations, gave similar opinion about the Union environment officials concerned.

"I have not given clean certificate to the Union environment officials who too ignored various violations at the site at various times. The report has clearly stated that the State government officials were hand-in-glove with the company in 2005 by ignoring Forest Rights Act," he told PTI.

Mr. Saxena said that it was a matter of concern that such violations were occurring rampantly.

"The grounds on which the Vedanta's project in Orissa was scrapped reflects the degeneration of moral and ethical values of our industry and government," said Mr. Saxena, a member of the National Advisory Council (NAC).

"I am not very happy. The case only shows our governance system has stooped to its lowest level. In fact it reflects the sorry state of affair in the country when it comes to environment and tribal rights.

Mr. Saxena did not spare even the Tribal Affairs Ministry for failing to take up the cause of tribals.

"I am sorry to say that the Tribal Ministry has failed to protect the rights of the tribals at the site in Niyamgiri hills (in Orissa)," he said.

On illegal mining, he said, "The image of mining industry is very poor. They are notoriously corrupt as they rush to meet soaring demand. It is high time the government seriously looks into the industry's functioning."

Vedanta's Balco alleged of encroachment, environment ministry orders probe

Economic Times

28 August 2010

NEW DELHI: There is fresh trouble for Vedanta Resources. The environment ministry has ordered a probe into allegations of encroachment of forest land by its Balco plant in Chhattisgarh. Vedanta has 51% stake in the plant, through its subsidiary Sterlite Industries.

The probe was ordered in response to allegations that the Balco plant has occupied forest land. Former Chhattisgarh chief minister Ajit Jogi had flagged the attention of the Union environment ministry to the violations. Balco was a PSU which was sold to Sterlite Industries during the NDA regime.

This is not the first time that allegations of encroaching forest land have been levelled at the Vedanta-controlled Balco plant. In an earlier instance, the plant was charged with encroaching 1,000 acres in violation of the Forest (Conservation) Act, 1980. There were also charges of felling 50,000 trees. All this was in connection with the expansion of the Balco plant.

There was some good news for Vedanta as well. The Anil Agarwal Foundation's Vedanta University project, to be housed in Orissa, is likely to be issued environmental and coastal regulatory zone clearance. The proposed university project will now have to give up 200 acres of the 6,892 acres allocated to it, to address a coastal regulatory zone clearance.

It will be located on the Puri-Konark Marin Drive. These clearances were put in abeyance in May, after the environment ministry received information alleging irregularities, illegal and unlawful deeds by the Foundation. The university project had been given conditional environment and CRZ clearance in April. The proposed Vedanta University project is estimated to involve an amount worth Rs 150 billion.

BankTrack welcomes Indian Government' decision to stop Vedanta

Bank Track Press Release

Indian government denies permission to mining company Vedanta Resources for Bauxite mining project on sacred tribal land

25 August 2010

Nijmegen, The Netherlands - BankTrack welcomes the decision of India's Ministry of Environment and Forests to not grant permission for forest clearance for the Sterlite bauxite mining project on the sacred Niyamgiri hills in Lanjigarh, India. The mine is a project of Sterlite Industries India Ltd., a subsidiary of London registered mining company Vedanta Resources and the state-owned Orissa Mining Corporation.

By not granting this permission also the environmental clearance for the mine is inoperable. The Indian Minister of Environment and Forest Jairam Ramesh concluded yesterday, August 24 that various laws have seriously been violated, including the Forest Conservation Act of 1980 and the Environmental Protection Act of 1986. He also stated that his Ministry will examine what penal action should be initiated against the project proponents for the violation of these laws.

BankTrack, together with many of our working partners[1] has been vigorously campaigning against Vedanta Resources[2] since 2009. We have sent warnings to private sector banks, shareholders and other investors against getting involved in Vedanta's shameless businesses and urged them to exclude Vedanta Resources from their investment portfolio. Many shareholders and other investors have already done so, among these funds like the Norwegian Government Pension Fund, the Church of England, the Dutch Pension Fund PGGM and private sector banks like German based WestLB.

As main reasons for their disinvestments investors mention concerns about Vedanta's persistent bad performance on environmental, social, and human rights issues, the financial risks that may arise from these practices, and their many failed attempts to engage with Vedanta in order to address and discuss their concerns.

For example, only yesterday, the Danish bank Dankse Bank published a list of companies that they have excluded from their ‘investment universe because they do not meet the requirements of Danske Bank's Social and Responsible Investment (SRI) policy'. It is no surprise that Vedanta Resources and Sterlite Industries India Ltd. are among the 28 companies listed.

Sonja Willems of BankTrack says: "As far as BankTrack is aware, Danske Bank is the first private sector bank to disclose a list of companies they exclude from doing business with. We think this is a laudable initiative and hope this good example will encourage other banks to do the same".

For more information contact: Sonja Willems, campaign coordinator

BankTrack - Vismarkt 15 - 6511 VJ Nijmegen - Netherlands - +31 24 3249220

[1] e.g. Survival International, ActionAid, Amnesty International, the London Mining Network

[2] For an overview of harmful projects Vedanta is involved in please have a look at their company profile at the BankTrack website:

Indian government rejection of Vedanta bauxite mine a "landmark victory" for Indigenous rights

Amnesty International Press Release

24 August 2010

Amnesty International today described the Indian government's decision to reject the bauxite mine project in Orissa's Niyamgiri Hills as a landmark victory for the human rights of Indigenous communities.

India's Ministry of Environment and Forests today rejected the mine project proposed by a subsidiary of UK-based Vedanta Resources and the state-owned Orissa Mining Corporation, after finding that the project already extensively violates forest and environmental laws and would perpetrate abuses against the Dongria Kondh adivasi and other communities on the Hills.

"The Dongria Kondh and other local communities have been struggling for years for this decision, which is a very welcome one," said Amnesty International's Asia-Pacific Deputy Director, Madhu Malhotra.

"The companies and the Orissa government should now guarantee that they will not attempt to simply move the project to another site without ensuring adequate safeguards - they must ensure they will respect the human rights of Indigenous and local communities wherever the companies operate."

Amnesty International also welcomed the government's decision to suspend the clearance process for the six-fold expansion of the Lanjigarh refinery at the foothills of Niyamgiri, operated by Vedanta subsidiary Vedanta Aluminium, after a government's expert committee found it to be illegal.

"The authorities should order a clean-up of the Lanjigarh refinery, which has caused air and water pollution, seriously affecting the rights of neighbouring communities who are finding life there unbearable", said Madhu Malhotra.

Amnesty International called on government authorities to establish a clear and transparent process that seeks the free, prior and informed consent of any Indigenous communities who may be affected by such projects, and respect their decision, in accordance with national and international law.

The Ministry-commissioned expert report that underpinned today's decisions, documented the companies' legal violations and human rights abuses. Its findings and the rejection of the project are consistent with Amnesty International's extensive report published in February 2010, Don't Mine us out of Existence: Bauxite Mine and Refinery Devastate Lives in India.

For eight years, the Dongria Kondh and other communities in Niyamgiri have been protesting against bauxite mining plans by Vedanta Resources subsidiary, Sterlite Industries India, and the Orissa Mining Corporation.

The communities were concerned that the project, which would have been situated on their traditional sacred lands and habitats, would result in violations of their rights as Indigenous peoples to water, food, health, work and other rights to protection of their culture and identity.

"After years of struggle and visits by committees our voice has finally reached Delhi," a Dongria Kondh leader today told Amnesty International.

For more information please call Amnesty International's press office in London, UK, on +44 20 7413 5566

International Secretariat, Amnesty International, 1 Easton St., London WC1X 0DW, UK

Vedanta says looking for alternative mines after setback

Times of India

25 August 2010

NEW DELHI: Vedanta Resources said on Wednesday it would seek other sources of bauxite in India after its plans for a mine in an area held sacred by tribespeople were blocked by the government.

Vedanta, owned by Indian billionaire Anil Agarwal, had wanted to start an open-cast mine in the Niyamgiri Hills in Orissa state to feed a nearby aluminium refinery, but the project was struck down Tuesday by the environment ministry.

Environment Minister Jairam Ramesh accused Vedanta of violating environmental rules and showing "blatant disregard" for thousands of Dongria and Kutia Kondh tribespeople who believe the hills are sacred.

"There is no dearth of bauxite in the state," Vedanta India spokesman Pavan Kaushik told AFP. "Niyamgiri was the preferred source because of its location (next to the refinery). Now we will have to get it from somewhere else."

He said that Vedanta was still committed to the one-million-tonne refinery, which is currently running on bauxite from neighbouring states.

Vedanta, which says it has already invested 5.4 billion dollars developing aluminium facilities in Orissa, has strongly rejected allegations of wrongdoing.

It will be up to state-owned Orissa Mining Corp., which holds the mining lease for Niyamgiri Hills area, to mount any legal challenge to the move to block the mine project, he said.

The Orissa government is scouting for other sources of bauxite nearby, Kaushik said.

The environment minister in a stinging statement on Tuesday threatened to scrap approval for the refinery, saying it had violated environmental regulations by building on forest land without permission.

Ramesh also accused Vedanta of starting a six-fold expansion of the aluminium project without approval, showing "the contempt with which this company treats the laws of the land".

Vedanta insists the complex will help alleviate poverty in the deeply deprived region, and that the company is committed to providing jobs, health care, education and school feeding schemes.

"We will continue with our commitment to the people in the area" despite the ruling, Kaushik said.

The company faces other problems in India over a proposed acquisition worth up to 9.6 billion dollars of 51-60 percent of Cairn India, whose biggest asset is the oil-rich Mangala field in Rajasthan state.Vedanta halts refinery expansion, questions Govt's intentions

Vedanta halts refinery expansion, questions Govt's intentions

Economic Times

27 August

MUMBAI/KOLKATA: Vedanta Aluminium has halted its expansion programme at the alumina refinery at Lanjigarh, in Orissa, after the government issued a notification making it mandatory for companies to seek environment clearance for any major change in processes.

On August 24, the Central government said that Vedanta Aluminium had not sought prior approval for expanding the refinery capacity to 6 million tonnes from 1 million tonnes.

Another government decision that day, announced by the minister of state for environment and forests Jairam Ramesh, stopping plans to mine bauxite at Nyamgiri near Lanjigarh, attracted much more attention but the brake on the refinery expansion could have a longer term impact on the fortunes of Vedanta. The bauxite was to be supplied to the refinery.

The chief operating officer of the Anil Agarwal-controlled company, Mukesh Kumar, expressed his doubts on Thursday over the "intention" behind these announcements in view of an earlier notification.

The ministry of environment and forests had said on August 19 that for all projects which were increasing capacity and where terms of references-the guidelines and scope for any expansion-have been mentioned and where construction activities have been started, the terms of references may be suspended or withdrawn.

"Instances have come to the notice of this ministry where project proponents have undertaken construction activities without obtaining requisite environmental clearance. No activity relating to any project covered under this notification, including civil construction, can be undertaken at site without obtaining prior environmental clearance," the notification added.

The notification relates to environment impact assessment (EIA)- a crucial part of the project approval process under the Environment Protection Act. The EPA is the umbrella legislation that regulates the impact of all industrial and commercial activities on environment.

The Vedanta official said that no prior approval for expansion was needed according to the rules in place-the Environment Impact Assessment notification of 2006-before the changes announced on August 19.

"There is no threshold limit given in the EIA notification for such a project," Mr Kumar told ET. "Hence prior environment clearance, as per the notification for our proposed expansion, is not mandatory before undertaking any construction activities."

Mr Kumar also referred to a section in the 2006 notification which stipulates that approval to the terms of reference for any project has to be announced within 60 days from the date of submission. "If the decision is not conveyed within 60 days, then the terms of references suggested by the applicant, "shall be deemed as final terms for the EIA study."

Vedanta had submitted its proposal for expanding the capacity to the ministry of environment and forests for approval on October 3, 2007. The company didn't get approval within 60 days, which is the mandatory period as per the notification.

Mr Ramesh did not respond to calls and text messages sent to his mobile.

While the expansion programme has been stopped, Vedanta Aluminium will continue with operations at the existing one million tonne refinery in Orissa. The unit is presently running at 90% capacity with bauxite purchased from outside the state. "Though Niyamgiri is off limit, we are hopeful of getting fresh allocation of bauxite reserves within 30 km of our refinery. There are some 500-600 mt of reserves in and around our refinery. Logistically, it won't be much of a problem," said Mr Kumar.

Vedanta needs three million tonnes of bauxite to operate its one million tonne refinery. The company has been sourcing 60% of its bauxite needs from group company Balco. It has also been using a blend of the ore using bauxite purchased from states like Maharashtra, Gujarat, Chhattisgarh, Madhya Pradesh, Andhra Pradesh, Jharkhand and Bihar. 

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