MAC: Mines and Communities

Vedanta struggles through AGM as Dongria Kondh say no

Published by MAC on 2013-08-07
Source: Statement, Guardian, Times of India, Dow Jones (2013-08-03)

The 2013 Vedanta AGM took place in London on 1st August. There were the usual streets protests outside - which this year were mirrored in Africa as well as India - and  unanswered questions from inside.

The meeting took place against the backdrop of voting on Vedanta's projected bauxite mining on the Niyamgiri hills in Orissa. The majority of tribal village meetings, given legal power by the Supreme Court of India, have unanimously voted against this flagship project. See: Jolt for Vedanta as mining in Niyamgiri Hills voted out

Vedanta says: India needs us, and it wasn't us what did it

http://londonminingnetwork.org/2013/08/vedanta-says-india-needs-us-and-it-wasnt-us-what-did-it/

3 August 2013

Report of the Vedanta plc AGM held in the London Marriott Hotel near Grosvenor Square, 1 August 2013

While a lively and colourful protest took place in warm sunshine outside the Vedanta AGM, those in the quiet, air-conditioned hall where the meeting took place may have had to fight somnolence.

Vedanta’s Executive Chairman, Anil Agarwal, is at risk of sounding like a talking doll containing a limited number of pre-recorded messages. Whatever the question, if the matter has anything to do with India, he has a tendency to come out with the same speech: India is a democracy; it has a population of 1.2 billion people; these people need jobs. Never mind about answering the question that was actually asked – the same speech usually seems to be made.

If the matter raised concerns the company’s plans and operations in the state of Orissa, Agarwal will add: India needs aluminium; local people are poor; they therefore need jobs. Never mind about the loss of traditional livelihoods caused by the creation of those very jobs; or the massive opposition to Vedanta’s plans expressed by many of those whom Agarwal sees as the potential beneficiaries.

If anyone mentions matters connected to legal decisions, such as an independent investigation into the deaths of workers at the company’s smelting plant at Korba or the consultations with Dongria gram sabhas (village councils) around the Niyamgiri Hills, the company is always waiting for something else to turn up. Independent investigation shows that we are culpable? Simply commission another one to show that we’re not. Decisions by gram sabhas legally binding? Simply tell investors that the thumping ‘no’ vote is merely advisory and that we await a decision by the ministry.

Senior Independent Director Naresh Chandra has his own key message: whatever the problems, Vedanta isn’t responsible for them. Vedanta’s only a holding company, and its subsidiaries who do the work are blameless: it’s either the civil authorities, state-owned companies like the Orissa Mining Corporation or outside agitators  who are to blame.

Agarwal began proceedings with a rambling and at times barely audible speech full of hope for the future, asserting his view that when companies prosper, society prospers.

CEO M S Mehta followed with a similarly enthusiastic endorsement of the company’s activities, though regretting the twenty fatalities and numerous injuries at company operations and assuring investors that the company is concentrating on making its operations safer. He implied that the Dongria gram sabhas whose permission was now needed before mining could proceed in the Niyamgiri Hills were voting ‘no’ because of the presence of outside observers. He asserted that nobody could know the final outcome of the gram sabhas (every one of which to date has voted against the company’s plans with a massive majority) until the court makes a judgement on them. Perhaps the company will be arguing that the court should reject the verdicts because of the presence of outside observers – but since proceedings were recorded on video, it will be hard to argue that the observers played any role in proceedings other than observing them… Mehta stated that Vedanta is a British company and therefore needs to live up to the expectations that this implies (low enough, you might think, given the behaviour of a number of London-listed mining companies) but it is also Indian and needs to take account of Indian customs as well. He did not elaborate on this.

Head of Sustainability Mark Eady then raced through what the company is doing to improve its environmental, human rights and corporate philanthropy record, asserting among other things that 3.7 million people are now benefiting from the company’s community programmes in 2200 villages and that the company is in partnership with 250 NGOs and academic institutions. The company will introduce an independent audit of its sustainability in 2014-15.

Mark Eady’s got his work cut out. His predecessor only lasted a couple of years or so - perhaps leaving in despair at being able to change anything other than policies, just as the Church of England disinvested from Vedanta after many months of fruitless ‘engagement’ with the company.

Chairman Agarwal called for questions, asking people to be brief, to ask one question only and to ensure that questions concerned the business of the meeting. The first questioner was a veteran of mining company AGMs, a Dr Luk, who asked five questions in one go, each of them accompanied by lengthy background statements. Other shareholders began to get restive when the rambling – and often irrelevant – answers to his questions passed beyond the 45 minute mark. Cat-calling began.

It’s not that Dr Luk’s questions were unimportant. Among them, he reminded the board that the company was heavily reliant on profits from its newly acquired oil and gas sector, in which it has very little experience; that it had been stopped from operating its Tuticorin smelter because of pollution; that it had been banned for some time from exporting iron ore from Karnataka; that it had been prevented by the Indian Supreme Court from going ahead with its plans at Niyamgiri after investing six billion dollars in the nearby Lanjigarh refinery; and that it was facing questions over corruption and corporate governance in Liberia. But it seems odd that this particular shareholder, in numerous mining company AGMs, is regularly allowed to ask multiple complex questions in speeches lasting, perhaps, quarter of an hour, and then given answers that, in this case, took over half an hour, while other shareholders are interrupted and cut off after very much briefer interventions.

In reply, Agarwal launched in to his favourite theme: India is a democracy, it has a population of 1.2 billion, these people need jobs… etcetera. After a while, company secretary Deepak Kumar quietly intervened to get him to answer the questions asked. This proved difficult. For instance: why are there court judgments against Vedanta? Well, because India is a democracy; it has a population of 1.2 billion… etcetera. Why is the merger between Vedanta subsidiaries Sesa Goa and Sterlite not going ahead? Silly billy! It’s because India is a democracy, and democracy means that the smallest person has the biggest rights, and someone has appealed a court decision allowing the merger, and it has therefore been held up, but it will go ahead soon, and that’s just as well, because if you invest in India, you are investing in 1.2 billion people (and it’s a democracy, don’t forget).

Agarwal warmed again to the theme of creating jobs, pointed out how damaging it is to workers when the plant where they work is shut down, and claimed that Vedanta had not retrenched any workers, unlike other mining companies caught by the ban on mining in Goa. He said the company had never touched the Niyamgiri Hills, that any activity there was being conducted by the state of Orissa or the state-owned Orissa Mining Corporation. He said that the company had always paid back its debts on time; that he had never sold any of his own shares; that legal decisions against the company simply showed that India is a democracy, and that we should believe in India and believe in democracy.

Dr Luk may have been left none the wiser on some of the questions he asked, but after three quarters of an hour, there seemed little shareholder sympathy left for his quest.

Celebrity human rights campaigner Bianca Jagger then asked what lessons the company had learnt from the Supreme Court ruling in the case of the Niyamgiri Hills and from the gram sabha rejections of the company’s plans to mine the hills. How would it apply these lessons to consultation and impact assessment? Does it accept the need for free, prior informed consultation (I am sure she meant to say ‘consent’) with adivasi people before embarking on any other project that will affect their rights? Has Vedanta conducted an internal investigation of suggestions that the company made false allegations against opponents and that people were imprisoned as a result? If no internal investigation has been conducted, would the board make a statement that this is unacceptable?

Agarwal replied that the lesson learnt is that to eradicate poverty, it is necessary for India to produce aluminium. Having not produced aluminium, the lesson is that India is a democratic country. Vedanta has done everything within the law, and it is very unfortunate that people have no jobs. The investment Vedanta has made is good for the country. India needs aluminium and must produce aluminium.

I took it that this was a “no”.

At this point, Senior Independent Director Naresh Chandra introduced his own favourite theme: it wasn’t us, guv – we’ve got nothing to do with it. The consultation process is the responsibility of the local authorities, the state government and the Ministry of Environment and Forests. The recent court decision had said that after the initial consultation had been done, the new Forest Rights Act conferred new ‘privileges’ (a loaded word) on local people, and so a new consultation was required, uninfluenced by external agencies (a dig at everyone who has tried to support the Dongria people). He said that although the Forest Rights Act confers rights on communities, the extent of those rights has to be tested by the courts. It is a right to consultation, not to veto. Lessons have to be learnt by state agencies and the courts, but not by the company, which was not involved. As for allegations made about false accusations, Vedanta ordered an internal inquiry. Five of the seven allegations brought by the National Human Rights Commission were found to be groundless, one was sent back to the Commission for further work, and the final case was investigated and found wanting. If any other allegations surface, they will be investigated.

Agarwal intervened again: Orissa is the poorest state on the country and requires jobs. The only way out of poverty is manufacturing. Vedanta has provided some light of hope by investing ten billion dollars in the state. Seven thousand workers worked for seven years to build the Lanjigarh refinery, and then it was shut down. People need jobs.

Ramesh Gopalakrishnan of Amnesty International said that he had been present in five of the gram sabhas as an observer. He said that it was peculiar that the company was saying that its relations with local communities were good, and that at least two of them were part of the company’s corporate social responsibility programmes, when all of them had said no to the company’s mining plans.

Agarwal replied that Ramesh’s issue was with the Orissa Mining Corporation, not with Vedanta, as Vedanta had not moved a single blade of grass. But the government had to provide the company with access to bauxite.

Ramesh then asked about the Human Rights Commission’s allegations. He said that a 2012 Amnesty International report noted that the Commission had said that some officials in Vedanta were instrumental, with local police, in fabricating false accusations against local people. Has any action been taken against those employees? Ramesh had not heard of any action being taken when he was in Lanjigarh ten days ago.

Agarwal replied simply that he appreciated that Vedanta should seek other sources of bauxite. Chandra said that the company is not active in the area and therefore not able to do corporate social responsibility. The company has stayed out of the area, in the spirit of the Supreme Court order. He said that any so-called ‘lessons’ are to be drawn by those involved. Vedanta had not been an actor in this process and if it had taken part or tried to influence it, it would not have been legal. On the Human Rights Commission’s allegations, if Ramesh had any further specific allegations he should let the board have them and if the company had not investigated them already, it would do so. He said that Vedanta had ‘zero tolerance’ for human rights violations.

Stephanie Maier, head of Corporate Responsibility at Aviva Investors (which, she said, holds 0.2% of company’s shares), suggested that companies pursuing their business in a responsible manner are better value in the long term. She said that since 2010 Vedanta shares had under-performed their sector of the FTSE by 29%. She and her colleagues think this is because of poor governance and a poor approach to sustainability. There has been serious mismanagement of community consultation and respect for Indigenous rights as Vedanta waits for the outcome of the consultation process at Niyamgiri. She said that Aviva had outlined ten conditions for improving governance and sustainability in 2010. Their recommendations had been met at a basic level but it had taken the board nearly four years to get to this point, and progress had been incomplete and patchy. The company has still made no public commitment to the UN Principles on Security and Human Rights. The time and effort that the company has devoted to setting in place new structures is welcome, the work of Tony Henshaw and successor Mark Eady is welcome, but Aviva has still to see evidence that these policies and procedures are really embedding in the company and bearing fruit. Aviva is disappointed that yet another new board director has been appointed without any significant mining experience. Aviva wants the board to devote greater time to understanding sustainability and recommends further training and a better focus on sustainability, which will deliver better value to the company and its shareholders.

Agarwal said that Vedanta is a holding company and that at the level of subsidiaries like Sesa Goa or Sterlite there are people on the boards who have great experience in mining. He then started off on one of his favourite themes, the need for India to produce aluminium, but Naresh Chandra intervened to emphasise that Vedanta is “not an operating company but a holding company”. He said that the new director, Deepak Parekh, had background in lending money to mining companies and that he himself had experience in mining management.

Peter Frankental, of Amnesty International UK, pointed out that the company’s Sustainability Report said that the company follows the UN Guiding Principles. He said that these principles state that businesses should conduct human rights impact assessments before work begins. He asked if the company was prepared to do such impact assessments in future. Would decisions to go ahead or not be based on these assessments and would assessments be shared with affected communities so that they could decide whether or not they want a project to go ahead?

Agarwal replied that in India at present “not a single project is going ahead”. He said that he agreed that human rights are important but the fundamental need is to create jobs. He finished by saying “If it is the best practice, then we will follow it”.

However, that was quickly followed up by Chandra who seemed to realize that this was too close to a commitment. He said: “We agree with every word you have said – but we cannot be judges of our own case.” He said that Vedanta produces reports which are sent to the environmental clearance authority, the Ministry, and it is they who say what is acceptable. He said that the company agrees that they should produce human rights impact assessments and that the commitment had always been there, but that people must distinguish between what the company has to do and what the public authorities have to do. If the authorities have been deficient, they must be addressed. If they require studies, the company submits them. If they say so much money is to go to local communities, the company does it. But Vedanta is not the total authority in India, and has to abide by what the government says. Amnesty should also, he said, consider that employment is a human right, and at present employment is being suffocated. Better living standards and the right to employment are precious human rights.

Many Dongria Kondh people are clearly unimpressed by Vedanta’s version of what constitutes ‘better living standards’ and attached to their own traditional livelihoods rather than ‘employment’ with the company.

Film-maker Simon Chambers observed that there had been a lot of talk about Vedanta following the letter of the law. He said he had asked before about the Korba chimney disaster, which caused the death of at least 40 workers in 2009 at operations controlled by company subsidiary BALCO. The report produced by the Buxi Commission since Vedanta’s last AGM shows that BALCO did not comply with the construction design of the chimney, that it did not comply with any of the local laws which said that the chimney should not be built, and that proper safety measures were not put in place. Simon asked if Vedanta would now accept the findings of this commission and take responsibility for the accident. He reminded Anil Agarwal that at the 2012 AGM he had said that he would wait for the results of the independent judicial review of the disaster. The Buxi Commission’s report is it. Would Chairman Agarwal now withdraw the statement he made before that the cause of the chimney collapse was a freak lightning accident? Could he say what had happened to four BALCO employees arrested and who had since mysteriously disappeared?

Agarwal replied that this had happened four years ago. The proper agencies had been involved. Vedanta had “not left anything unturned to find out what happened”. Every family affected had been given employment or compensation.

Chief Executive M S Mehta added that the company had made the best technical studies of the collapse. The Buxi commission had relied on the findings of junior engineers. Even they had said that the cause may have been materials used ‘or something else’. The Buxi Commission had failed to provide the proper opportunity for Vedanta to provide its own figures. The company has therefore filed an appeal in the High Court of Chhattisgarh and the court has granted a stay. A study commissioned on the deaths had found that the families are aggrieved at the loss of their loved ones but that the compensation offered is acceptable to them. He said that Vedanta does not accept the findings of the Buxi Commission.

Simon pointed out that the previous year the company had said it was waiting for the findings of the Buxi Commission. Now it was saying that it does not accept its findings.

Anil Agarwal said that five or six bodies were doing studies, then the court has to decide what are the facts. Vedanta cannot prejudge the issue. It cannot decide its own case and say that it is guilty. Six agencies are involved, five of which say something other than the Buxi Commission. Now the court is considering the matter and the company is waiting for the verdict of the court, which will be final.

One shareholder complained that he felt as if he were in a ‘political meeting’ and that the points raised had nothing to do with a company AGM. He complained about the cost of paying for human rights training for Vedanta employees and said shareholders should not have to pay for this. He also said that the company must improve its safety record, because he had seen the impact on shareholders of poor safety at BP. Agarwal replied that the company’s first priority is safety. M S Mehta said the company trained people in human rights because there are certain expectations of a multinational company.

Activist researcher Samarendra Das, of Foil Vedanta, reminded the Chairman that in 2012 he had promised that the company’s report would no longer use the racist term ‘backward’ for the Indigenous Dongria Kondh people. But the report still contained the term. He asked if the Chairman respected Indigenous communities. Agarwal undertook to remove the term from future publications. Samarendra and Simon pointed out that he had made the same promise last year and not kept it. Agarwal assured them that it would be done.

Samarendra then said that he had spoken earlier in the day to Dongria friends in Niyamgiri and that they had asked him to sing a song, saying that Anil Agarwal is not welcome in their territory. Samarendra then sang the song, to shareholder applause.

Andy Whitmore, of Indigenous Peoples Links, raised an issue of corporate governance. He said he was confused by what the Annual Report said about corporate governance. On page 78, it made clear where Vedanta does not comply with UK government recommendations on corporate governance, primarily because of Anil Agarwal’s role as Executive Chairman. On page 81, company policy on conflicts of interest is explained. Directors with a perceived or actual conflict of interest in a particular matter do not participate in discussions or vote on that matter. The report then lists the ‘related parties’ to Vedanta, which outlines where those conflicts can occur, and it lists the Agarwal family’s “controlling interest” in Volcan Investments as one of those  parties which represents a perceived or actual potential conflict of interest.  Andy then noted that on page 78 the report states that Volcan will be consulted on all nominations to the board. Yet, Anil Agarwal is Head of Vedanta’s Nominations Committee. Therefore under the policies laid out he would have to absent himself from all decisions because of the conflict of interest involving Volcan. How did the board deal with that very real conflict of interest?

M S Mehta said that consultation with Volcan was a formality and that Volcan had no veto power. There was therefore, in practice, no conflict of interest.

Another shareholder asked about the kinds of accidents that had been happening at the company’s operations, noting that the annual report did not give these figures. M S Mehta noted they were in the ‘sustainability report’ and listed the categories of accidents, including release of toxic gases, severe burns and people falling from a height. He said that Vedanta is working to improve safety performance.

Mining researcher Richard Harkinson, of London Mining Network, drew attention to page 135 of the Annual Report, where note 4 to the ‘Special Items’ mentioned compensation of 18 million dollars for certain impacts of the Tuticorin smelter. He asked whether this was a final compensation sum or whether there might be further compensation to come. He pointed out that claimants were suffering from cancer and other serious conditions and that litigation had been going on since 2010, is not finalized and is open to more litigants to join. He said that Vedanta’s attitude seemed to be that it would do nothing to mitigate harm unless it received permission to increase the size of the plant. How could the 18 million dollar figure be final when litigation is continuing?

M S Mehta replied that the Supreme Court had decided that the plant is compliant with the law. During the 2003-5 period, compensation was imposed for the general improvement of local area. The figure of 18 million dollars applies to the period 2003-5 for some non-compliances.

Richard concluded that litigation that had taken place since 2005 and is continuing may lead to much higher compensation sums. He then noted that page 107 of the Annual Report stated that charitable donations of 1.85 million dollars had been made during the year, and political donations of 0.97 million dollars. He suggested that uplifting politicians was almost as important to the company as uplifting communities. How did the company make these decisions?  How does it choose which politicians to support, and on what basis, and how does the company make this transparent?

Naresh Chandra replied that the company does not give money politicians but to political parties. He said that when the freedom movement began, money had to be given to political parties by businessmen to strengthen democracy, otherwise only rich people would be able to stand for election. A lot of people with poor means have been able to fight elections. Perhaps India may move to a situation where political donations are banned but at present it is legal. What Vedanta does is consistent with Indian law. The parties’ names are published, and there is total transparency (although not, apparently, in the Annual Report).

Richard then noted that Mr Chandra had said that the Orissa Mining Corporation is responsible for the mining plan in the Niyamgiri Hills. Amnesty International had said that if the company wishes to comply with the UN Guidelines on Business and Human Rights it needs to do so in practice and not simply as an aspiration. He suggested that the Orissa Mining Corporation is just a vehicle to enable Vedanta to relocate people compulsorily, and that Vedanta itself was responsible for everything else that was happening at Niyamgiri.

Anil Agarwal said it was time to move on to the resolutions…

And of course, they were all carried with massive majorities. How could they not be? Agarwal controls this supposedly public company.

So we staggered out into the light and heat, wondering how this company continues to get away with its outrageous behaviour on the ground and its evasiveness and duplicity in London, while people STILL invest in it and STILL think they might improve it through ‘engagement’.

There is no hope for this company: investors should pull out, and the company should be expelled from the London Stock Exchange.

Meanwhile, let’s celebrate the massive rejection of the company’s plans in Niyamgiri while remaining vigilant for the company’s efforts to get round the gram sabha’s decisions. And let’s pursue it for its misdeeds in Korba, Goa and elsewhere in India, and in Australia, Ireland, Liberia, Namibia, South Africa and Zambia, and wherever else it rears its ugly head.

Richard Solly, Co-ordinator, London Mining Network


Top City investor attacks miner Vedanta Resources

Company's poor sustainability record depresses its share price, says Aviva Investor's Stephanie

Simon Goodley

The Guardian

1 August 2013

Vedanta Resources, the mining company routinely criticised for its performance on human rights, the environment and safety, has been attacked by a top City investor for allowing its poor sustainability record to depress its share price.

At its annual meeting in central London on Thursday, which also heard from human right campaigners including the former model Bianca Jagger and Peter Frankental from Amnesty International, Stephanie Maier, head of corporate responsibility at Aviva Investors, said Vedanta's shares had underperformed mining peers by 29% since 2010. She added that, while the miner had made improvements, its independent directors were too weak to push through significant change.

"We consider that a proportion of this [share price under-performance] can be attributed to the mismanagement of sustainability issues," she said. "We are still to see the evidence that [new] policies and practices are to be comprehensively embedded in the company and translated into action on the ground.

"This cultural change should be driven by the board, and an appropriately skilled and experienced board is therefore crucial. We are disappointed, therefore, to see another director [Deepak Parekh, who joined the board last month] appointed without a credible track record in mining or sustainability issues and we withhold support for all non-executive directors as we do not consider that there is sufficiently robust and independent challenge and oversight at board level."

Aviva is a small investor in Vedanta, holding about 0.2% of the shares.

The company, whose shares have lost about 60% since 2010, received a blow this week when indigenous communities in India overwhelmingly rejected a proposal by one of its subsidiaries to mine their sacred lands.


Vedanta suffers rebuke on executive pay

Mark Cobley

Dow Jones

2 August 2013

Vedanta Resources, the UK-listed mining conglomerate, suffered a rebuke from its independent shareholders yesterday when more than half of them voted against its directors' pay report and a quarter registered a personal vote against a senior non-executive director.

Vedanta is listed on the London Stock Exchange but majority-owned by a company called Volcan Investments, which represents the holding of Anil Agarwal, Vedanta's founder and executive chairman, and one of the richest men in India. Volcan controls almost 65% of Vedanta's stock.

This morning, Vedanta reported that 22.5% of all its shareholders had voted against the company's remuneration report at its annual general meeting yesterday - independent shareholders hold 35% of the company's stock. That is over twice the scale of the average dissent on pay reports in the FTSE 100 this year, which is 9.28%, according to shareholder advisory firm Pirc.

Independent director Aman Mehta experienced a 10.3% vote against his re-election, while 8% of shareholders declined to support another independent director, Euan Macdonald.

In a separate statement this morning, Vedanta announced that following the AGM, Mehta would become the senior independent director on the board, while Macdonald will chair the remuneration and sustainability committees.

Pirc, which is known for its hawkish stance on executive pay, told its clients ahead of the vote: "[Vedanta's] remuneration during the year is not considered excessive."

But Pirc argued the company should give more detail about how it links the bonuses paid to senior executives to progress on sustainability and environmental issues. Pirc said: "Specific criteria are stated, but targets and vesting scales are not provided." It also said there was insufficient detail available on the company's new employee share-ownership plan.

Earlier this week, London-based fund manager Aviva Investors, which owns about 0.2% of Vedanta's stock, also criticised the company. It has been pressuring Vedanta since 2010, when controversy erupted in India over a bauxite mine the company has been planning in the state of Orissa. The plans have been opposed by a local indigenous tribe.

Aviva said that a lack of concern over human rights and environmental issues such as this had contributed to Vedanta's 29% share price underperformance, compared with its mining peers in the FTSE All-Share index, since the start of 2010.

Stephanie Maier, head of corporate responsibility at Aviva Investors, said at yesterday's AGM that her firm would withhold support from all the company's independent directors, as "we do not consider that there is sufficiently robust and independent challenge and oversight at board level".

A spokeswoman for Aviva confirmed this morning that the fund manager had voted against the pay report for similar reasons.

A spokeswoman for Vedanta Resources declined to comment.


India: Vedanta holds AGM as indigenous community rejects mine plans

http://www.amnesty.org.uk/news_details.asp?NewsID=20901

29 July 2013

As FTSE 100 mining company Vedanta gears up for its AGM this week (Thursday 1 August), indigenous communities in India have overwhelmingly rejected a proposal by one of the company's subsidiaries to mine their sacred lands.

In what Amnesty International calls an unprecedented victory for indigenous rights over business interests, India's Dongria Kondh communities have sent a clear message to Vedanta that plans to mine their lands in the state of Odisha (also known as Orissa) must be dropped.

The communities were responding to an official consultation of indigenous groups ordered by India's Supreme Court in April.

The consultation involves 12 villages affected by Vedanta's plans for a bauxite mine in the sacred Nyamgiri Hills - all seven villages where meetings have been held so far have rejected the mine plans.

According to Amnesty's Economic Relations Programme Director, Peter Frankental:

"The chickens are coming home to roost for Vedanta and their shareholders after years of ignoring the concerns of the Dongria Kondh communities.

"Shareholders at Vedanta's AGM should now ask serious questions as to why the company continued to pursue the project despite evidence of the harm it would cause to indigenous people.

"This is a warning to any company planning to operate in an area inhabited by indigenous peoples that their free, prior and informed consent should be sought from the outset in keeping with international standards.

"It is also a warning to shareholders and bank lenders to intervene much sooner when companies they invest in fail to address human rights in their impact assessments of major projects."

Amnesty's Researcher Ramesh Gopalakrishnan, who was an observer at several of the village council meetings that rejected the mine plans over the past two weeks, said:

"This decisive vote surely means the end of Vedanta's plans to mine the Niyamgiri Hills - a project that would violate the community's economic, social and cultural rights and almost certainly their rights as indigenous peoples.

"After struggling for a decade against the threat to their way of life, the Dongria Kondh have now finally been able to assert their right not to consent to the mine."

Background

Under both Indian law and international human rights standards, indigenous people have special protections to ensure that their traditional lands and way of life are not destroyed. The principle of free, prior and informed consent has been established to guarantee that there is proper consultation with indigenous communities and that their rights are fully respected.


Bauxite out of bounds, Vedanta now turns to laterite deposits

Satyanarayan Pattnaik

Times of India

3 August 2013

KORAPUT: With hopes of mining bauxite in Niymagiri hills virtually dashed, Vedanta Aluminum Limited (VAL) is now eyeing laterite deposits in Rayagada district for raw material for its Lanjigarh refinery.

The company sought permission for extracting laterite deposits at Sagabari, Panabara and Arotokoni villages spread over 113 hectare under Kashipur block of Rayagada in. The deputy director of mines, Koraput, on Friday forwarded VAL's application and its preliminary report to the Rayagada administration.

Mining experts said laterite soil carries 20 to 25% bauxite.

"If the company gets the government nod to extract laterite deposits, its bauxite problem could be sorted out to some extent. The whole process will take a few months," said mining officer (Koraput) S P Nanda.

Rayagada collector Sashi Bhusan Padhi said, "After going through the report and the application, we will make necessary inquiries. We will then send our report to the director of mines and the department of steel and mines."

However, there is no guarantee that anti-mining bodies will not oppose laterite extraction too.

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