MAC: Mines and Communities

India Update

Published by MAC on 2006-03-01

India Update

Australia hails easing of mining norms
K. Venugopal, Hindu Businessline


1st March 2006

Australia today welcomed the liberalisation in the rules on captive mining announced in the Budget. The Minister for Foreign Affairs, Mr Alexander Downer, told visiting journalists from India that his Government would definitely be keen to see liberalisation in areas such as mining. "Australian mining companies such as BHP Billiton, which is probably one of the largest mining companies in the world and Rio Tinto can bring a lot of investment and expertise to India," he said. "This is one of the areas where we can significantly upgrade our economic relationship."

Another area would be the deregulation of the retail sector allowing foreign investment. "You can have the major Australian retailers interested in investing in India," Mr Downer said. He noted that the visit of the Australian Prime Minister, Mr John Howard, to India starting March 6 would see an enhancement of the bilateral relationship. There would be agreements signed on education, information technology, and on trade, he said. "It is a good relationship... I think this will strengthen it."

Cutting edge in diamond recce

by SANDEEP SARKAR, The Telegraph (Calcutta) Jamshedpur

27th February 2006

Jindal Steel & Power Ltd (JSPL) last week bagged a reconnaissance permit to carry out an aerial survey of 3,009 square kilometres for diamond and other precious minerals in the state.

JSPL is required to pay Rs 11 crore to carry out the survey over the next three years. The survey would include topographical study, land pattern, water bodies etc.

While the Jindals are known for their passion for steel and some experts feel they are fast emerging as one of the most important producers, a licence to carry out surveys for diamond has come as a surprise.

No such licence has been granted so far to De Beers, the well-known South African company, which has the experience and the expertise for diamond prospecting. The company, in fact, has been engaged in carrying out surveys in both Orissa and Chhattisgarh besides several other states.

With Jindals not known for their interest in diamonds, De Beers spokesmen smell a rat, though they refuse to make any allegation. The state government officials explanation is that the applications of both Jindals and De Beers were forwarded to the Union government and it was eventually New Delhi which cleared the application. Both the applications were submitted in 2004.

Sources in De Beers, however, alleged that according to their information, the state government had made no effort to get their proposal cleared by Delhi but bent over backwards to get the go-ahead for the Jindals.

Company officials appeared peeved and indicated that they were keen to start the survey in Jharkhand. “But till we receive the permit, we have no option but to concentrate on Orissa, where we have already been issued the licence,” confided a De Beers official.

Mines and geology secretary A.K. Singh, however, said the application of De Beers was also under active consideration and the state government would issue a permit to the company as soon as the proposal is cleared by the Centre. Jindals, claimed departmental sources, were just more keen than the South African company.

De Beers India Prospecting Private Limited, the Indian arm of the South African major, had applied for two reconnaissance (survey of a region) permits for carrying out surveys in Gumla and Lohardaga. The surveys have been earmarked in two areas measuring 2061 sq km and 2010 sq km respectively.

The company had planned to spend Rs 100 crore on air-borne geo-physical surveys, said company officials. It claims to have invested Rs 100 million so far in conducting surveys in other states.

Strangely, sources in the government claimed that the permit had got delayed because of the South African company’s reluctance to commit that it would also undertake cutting and polishing of diamonds. De Beers is a supplier of diamonds but gets them cut and polished by sightholders (certified marketing agencies).

Officials said the government would like to follow a uniform policy of issuing permits for mineral exploration. Unless companies are willing to add value to the minerals, they cannot be allowed to take away the minerals.

In early 2003, De Beers had conducted preliminary surveys to identify fields in Gumla, Lohardaga and the banks of the Sankh river where there could be a possibility of diamonds. After identifying the prospective areas, the company submitted a detailed proposal to the government which was forwarded to the Centre for clearance.

Orissa Govt. to review land requirements

by Himansu S. Sahoo / Hindustan Times, Bhubaneswar

27th February 2006

To minimize the disputes prevailing over acquisition of tribal land for industrialization the Orissa government may soon review the exact land requirements of various steel and alumina plants in the state. A Ministerial Committee studying the Revised Rehabilitation and Resettlement Policy of the government on Monday proposed to constitute a Technical Committee for reviewing the land requirements of both existing as well proposed industries.

Industries Minister Biswabhusan Harichandan, who is heading the Ministerial Committee said, in case a private company possesses excess land than the exact requirement for its project the government may ask for surrender of the extra land and distribute the same among the displaced families, the minister said. However, concrete future expansion programmes of the plants will be taken into consideration by sate government while asking the private companies for the return of excess land.

"If the proposal gets approval of the government and chief minister’s nod the steel and alumina plants may be asked to return the excess land in their possessions" Harichandan said.

The Ministerial Committee on Monday invited two former chief ministers of the state, retired bureaucrats, tribal leaders, social activists, representatives of agitating Kalinganagar tribals and some of the district collectors to give their proper implementation of the revised Rehabilitation and Resettlement Policy.

However, neither of the two former Congress chief ministers- Giridhari Gamang and Hemanand Biswal nor any of the tribal leaders and representatives of Kalinganagar tribals attended the meeting. Prominent social activist and pioneer of several tribal movements in the state Rulsi Munda strongly viewed that with out proper rehabilitation of the displaced families no industrialization work should commence. None of the families displaced for industrialization should remain landless and the land allotted by the government for their rehabilitation be made hereditary.

There was a common proposal from all invitees that persons and families who have been displaced more than once for industrial activities or developmental projects be given attractive compensations. Similar treatment should be also given to displaced families who don’t have eligible persons to avail employment opportunities in the plants.

A former additional chief secretary Srinivash Rath proposed that a Compensation Committee can work in close coordination with Revenue department of the state government, Industrial Complex itself about 13,000 acres of land has been allotted for industrialization. About a dozen of steel plants industrialization. About a dozen of steel plants including the one by Tata is coming up in the complex. In total the Orissa government has signed MoUs with private companies for the setting-up of 43 steel plants in different parts of the state.

Govt on fresh MoU signing spree

by Hindustan Times, Ranchi

27th February 2006

With 42 already under its belt, besides the one with Baba Ramdev in the medicinal herbs sector, Jharkhand Government now intends embarking upon a fresh Memoranda of Understanding (MoU) signing spree. As many as 19 MoUs, including some old ones with some new incorporations and amendments are lined up in the next few days. This follows the clearance by the Chief Secretary-headed high-powered panel.

The new MoUs include one with Burnpur Cement and Jupiter Cement. The former plans to set up its plant in Patratu, while the latter has proposed it in Chaibasa.

BJP MLA from Barkagaon Loknath Mahto, in whose Assembly constituency Patratu falls, met Chief Minister Arjun Munda on Monday to take up the issue of Burnpur Cement, whose techno feasibility report was finalized a month ago.

Among the MoUs are those of Essar Steel, which has propo9sed an expansion of its initially proposed project and Jindal Steel with its plans to set up a 1000 MW power plant.However, with the Government yet to clear allotment of iron ore mining lease to any major industrial house no firm commitment has come from the latter.

PIL against Tata's Steel Project in Bastar

by Pratap Agarwal

On 15th february 2006 the Chhattisgarh High Court, in response to a PIL filed by Dr. Pratap Agarwal, issued a notice to the Chhattisgarh government and District Collector, Jagdalpur asking for a response within a matter of 3 weeks.

Tata Steel Limited has signed an MoU for investment of Rs. 10,000 crores for establishing a steel plant at Chitrakoot with the government of Chhattisgarh. This will affect 10 villages of the Lohsinghguda block, where 6500 acres of land will be acquired for the project. Almost 6500 families are expected to be displaced as a result. Tata Steel had initially selected a site in the adjacent Bastanar block but the deal could not work out since the land had already been selected for mining of diamonds.

The protests at the villages in Lohsinghuda started as soon as the villagers found out about the possibility of such a plant and the land acquisition. Parliamentarians Mahendra Karma and Baliram Kashyap visted the area to discuss the matter with the people but had to face strong opposition.

The two leaders then supported the setting up of a Bastar Hit Sanrakshan Samiti – a group that would work with the villages to persuade them to sell their lands to the government.

This was followed by the organisation of another group – Nagrik Samiti – that visited the villages in the area to convince them to support the setting up of the plant by giving their lands on the basis that they would be entitled to a Rehabilitation Package as well as employment in the factory. While most people remained unconvinved about 10 people agreed to sell their 25 acres of land.

According to Dr. Pratap Agarwal purchase of agricultural land for industrial purposes is not acceptable. Common lands used for temples, burial, housing, village roads, schools, ponds and community centres cannot be acquired for industries in this region. It is a violation of the basic rights of the people.

He also said that earlier in Nagarnar a similar process was carried out where people were forcefully moved from their lands with false promises of rehabilitation which were never fullfilled. The National Mineral Development Corporation that was to set up a mining project there within 6 months,did not even begin its operations in the area four years after purchasing the land.The Bailadilla mines have already polluted the waters of the Shankhini and Dankini rivers. After all this the people of the area have got nothing. He also added that the ESSAR Pipeline project has employed only two local adivasi boys as porters in the name of employment.The politicians and government servants cannot be trusted in this matter.

The petitiner adds that the company – Tata Steel does not even require 6500 acres of land for its plant. It can instead purchase the 1000 acres of government land at Dilmili. The 20 page Petition supported with various press cuttings fromthe Navbharat, Dainik Bhaskar, Deshbandhu, Haribhoomi, Highway Channel, Channel india makes a good case highlighting the violation of rights of the adivasis, women, children, dalits and marginalised communities.

On the other hand TATA and other companies have been organising kabbadi matches and recreation activities to mobilise and gain popular support from the locals and villages in the area

Hatching the plot

One of the world's largest and most influential engineering consultancies is to provide "services" to Mittal Steel for its massive prospective steel plant in Jharkhand.

Hatch Associates (headquartered in Canada, but with a branch in the UK) has advised on numerous minerals and hydro-electric projects, working with several of the world's major resource exctraction companies.

It was the lead advisor to the World Bank on the Chad-Cameroon oil pipeline long condemned byBank "watchers" and recently by Amnesty International. The Bank has now frozen funding from this Exxon-Mobil project on grounds of "corruption."

Mittal ropes in Hatch for Jharkhand project

by Rajesh Roy, The Telegraph (Calcutta)

24th February 2006

The Mittal steel on Friday appointed England based Hatch Associates Limited to provide consultancy and engineering services for the preparation of a project concept study, in support of a detailed project report(DPR), for its proposed mega steel plant in Jharkhand.

The move is sure to go a long way in dispelling doubts over the most global producer of steel's Jharkhand plant. In a recent interview to a private news channel, steel magnet LN Mittal had claimed that his company's steel project in Jharkhand was gradually taking shape.

Hatch will provide professional services for the analysis of the market for steel products in India, and prepare a concept and design basis for the proposed 12 million tone per year steel plant.

Commenting on the appointment of Hatch Associates, Dr. Sanak Mishra,CEO, Mittal Steel's Jharkhand Greenfield project said, "The appointment of Hatch is a major step forward in the plans of Mittal Steel to set up a world class steel plant in Jharkhand."

Globally acclaimed company, Hatch provides consultancy, engineering and project delivery services for mining and metals, energy and infrastructure projects. Hatch was selected on the basis of its world wide network of expertise in iron and steel making markets, technologies and major capabilities.

Mittal steel had signed a memorandum of understanding with the Jharkhand Government in October last year for setting up an integrated steel plant of 12 million tone capacity. The project is expected to entail an investment of approximately Rs 40,000 crore.

As per the Agreement, the project would be developed in two phases of a 6 million MT each. It is expected that the first phase would be completed within 48 months after agreement of the DPR and the second phase within a further 54 months after completion of the phase one.With operations in 16 countries and four continents, Mittal Steel Company encompasses all aspects of modern steel making to produce a comprehensive portfolio of both flat and long steel products to meet a wide range of customer needs. The company's unit in Jharkhand is expected to cater to the requirements of the major steel consuming sectors, including automotive, appliance, machinery and construction.

Hatch advisor to World Bank

by Hatch Website

23rd October 2002

Hatch acts as an advisor to the World Bank with respect to its role with the US$4-billion Chad-Cameroon Pipeline Project. Hatch consultant Jacques Gérin of Montreal is Executive Secretary of the International Advisory Group (IAG) established by the Bank to supervise the project.

The oil-pipeline will deliver 225,000 barrels a day, from a 300-well oilfield in Chad, through Cameroon to a marine terminal 16 kms offshore Kribi, Cameroon. The project is operated by ExxonMobil on behalf of a consortium that includes Chevron and Petronas. The project is expected to produce one billion barrels of oil over its 25-30 year life.

World Bank, which provides funding to the two governments both directly and through IFC syndicated loans, has proposed a number of safeguards to ensure the project contributes to the specific interests of the populations of the areas affected by the project.

One safeguard was the appointment of the IAG, an independent review panel of six persons, chaired by a former Prime Minister of Senegal. The IAG has the mandate to observe, advise and report on all aspects of the project, including in particular the use of the project revenues by the two governments and the developmental impacts on the populations.

Monsieur Gérin is a former deputy minister of Environment in Canada. He is governor of the International Development Research Centre (IDRC), and chairman of the board of the International Institute for Sustainable Development (IISD).

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