MAC: Mines and Communities

London Calling applauds condemnation of Vedanta

Published by MAC on 2010-03-18
Source: London Calling

- and urges broader campaign against "criminal" company

For the past six years, UK-listed Vedanta Resources has been castigated by Adivasi (Indigenous Peoples) groups, environmentalists and human rights organisations, for numerous alleged violations of Indian law. Hardly a month has passed when accusations of illegality - ranging from land encroachment to pollution, bribery and even murder - haven't exercised campaigners around India and as far a-field as the UK, Norway and the USA.

The bulk of these accusations centre on Vedanta's operations in the Lanjigarh district of Orissa, where the company operates an alumina refinery and covets part of the adjacent Nyamgiri hill range - a potential source of millions of tonnes of high-grade bauxite, the raw material for aluminium.

Now, a high-level enquiry, held by India's central Ministry of Environment and Forests (MoEF), has verified two of the most significant charges laid against Vedanta since 2003: that the company contravened both the Forest Conservation Act of 1980 and the Forest Rights Act (2006).

The legal expert on the investigative team, Usha Ramanthan, delivered the most damning indictment, employing terms taken directly from statements by an overseas human rights organisation. This is that the mining of Nyamgiri may lead to the "destruction of the Dongria Kond[h]s as a ... tribal group."

The two other reports issued by the team were rather cursory and somewhat ambivalent. Nonetheless, one of them did censure Vedanta's proposal of a year ago, to expand its current mine lease area six fold. That's something the company is intent upon in order to adequately "feed" its alumina smelter in Lanjigarh, and thereby the huge smelter it's already constructing elsewhere in Orissa. See:

Although the Dongria do not inhabit the area scheduled for mining (the one verifiable counter-claim offered by Vedanta in its defence against recent criticism), the people are crucially dependent on access to the hills and the waters flowing from them. The MoEF team concludes that the company has already seriously infringed forested areas which are vital to sustaining Dongria livelihoods.

So, what now?

The head of the MoEF in Delhi, Jairam Ramesh, was quoted last week as confirming that the company " ha[s][ violated the Forest Rights Act, without taking consideration of the tribal rights." (See: "Vedanta flouting green norms in Orissa", Express Buzz, 13 March 2010, below).

However, Vedanta has for a long time methodically insinuated itself into the political framework of Orissa, penetrated the local economy around Lanjigargh, and courted alliances at the seat of central government through the overweening and malevolent influence of company chairman Anil Agarwal and his family, who own the majority of Vedanta's shares. (See:

It is not at all unlikely that the company will merely be slapped on the wrist, told to amend its ways, and then allowed to proceed with its mine project - albeit after further delay and modification.

Meanwhile, although this "case" (in reality several different cases entwined together) is emblematic of the amorality at the heart of India's most successful and diversified mining company, it is not necessarily the wordt. The uniquely rapt critical attention paid to Vedanta's operations in Lanjigarh has certainly been crucial; both for the (sometimes uneasy) international linkages it has enjoyed, and as a litmus test for just implementation of Indian Indigenous Peoples' rights.

However, some of the energies applied to halting Vedanta's activities in this small corner of Orissa might have been better deployed to some of the company's egregious operations elsewhere.

The Lanjigarh refinery and putative Nyamgiri mine are but two components of a huge aluminium complex. To date, very few campaigners have  publicised the illegalities perpetrated during construction of the company's Jharsaguda smelter in the same state. Yet this is the biggest single project for which Vedanta has been raising Indian and international finance over the past year.

Six months ago, a subsidiary of Vedanta was accused of complicity in one of India's worst irecent industrial disasters. At least 42 contract workers were buried alive, following the collapse of an ill-constructed (and possibly illegal) power plant chimney. Demands for a full, independent, enquiry into what happened at Korba in September 2009 are now pretty thin on the ground, though a few people in India and the UK are still intent on uncovering the truth (See:

In November 2007, the Norwegian government determined that Vedanta was "grossly unethical" in an investigation carried out by the country's Council on Ethics. This critiqued not only the Lanjigarh-Nyamgiri issues, but other Vedanta exploits in India, Zambia and elsewhere. See:

Twenty seven months later, and the Church of England arrived at a similar conclusion (if one more weakly expressed) on the basis of which it sold all its shares in the company. See:

In this column, since 2003, we have gone one step further - dubbing Vedanta a "serial corporate offender". The evidence for this is, we believe, unimpeachable. Any "redress" offered by the company for its transgressions has been at best inadequate and at worst methodically designed to draw a veil over its true intent.

The MoEF censures of this UK outfit's egregious modus operandi  are certainly welcome. But, if Vedanta is to be prevented from continually wriggling out of obligations to comply with the law - by deed and not mere word - it has not only to quit Nyamgiri  altogether. Arguably it should also be forced to halt all work at its Orissa refinery and smelter. An Indian Supreme Court subcommittee in 2005 concluded that the former was constructed without a valid full permit (See: And there is yet another outstanding court case against the latter on similar grounds. See:

Not fit for purpose

Put these contentions alongside many others against the company, and it's difficult to escape the conclusion that Vedanta is - bluntly put - not fit for purpose.  At least not as presently constituted, with its deplorably complacent board, overwhelmingly dominated by just one man and his clan.

Unless the broader picture is thoroughly and graphically painted, the true enormity of this insidious enterprise will continue escaping proper recognition. Vedanta may run for cover, but it will recover - no doubt to re-surface elsewhere when the time is judged ripe. (There are, for example, other invaluable, as yet un-dug, bauxite hills elsewhere in Orissa, on which the company has its eyes).

Recent news reports suggest that Mr Agarwal and his clique are well aware of the heat rising in his criminally-contaminated kitchen. He has mooted dividing his enterprise into seaprate units, and only this week announced a prospective primary listing of  one or more of these on an international stock exchange.

Meanwhile, with a subtlety uncharacteristic of the man in person (and probably owing more to the henchmen on the board), Agarwal appears to be asserting that Vedanta isn't actually a British company after all. (The Mining Journal took the bait in last week's issue when it described Vedanta as "one of numerous Indian companies with an appetite for African ore deposits" [our italics]).

This contention may be based on recent dilution of his family's holdings in Sterlite Industries India. If so, it is a smokescreen. The corporate interlocks between the master outfit and its serf are unequivocal. In any event, Vedanta Aluminium - the entity now in the Orissa dock - is directly controlled from London, not Mumbai.

Thankfully, Usha Ramanathan (the female member of the Lanjigarh investigatory team reporting last week) is under no such illusion, and added further grist to the mill grinding against Vedanta. She reminds us that, in 2007, influenced by the Norwegian government's ejection of the company from its Pension Fund, India's Supreme Court itself ruled against the UK company's mining of Nyamgiri. But the Court, in an extraordinary and so- far unexplained U-turn, then allowed Sterlite to clamber into the hills through the back door - even though it had just shut the front door on its parent.

As Ms Ramanathan points out, this was a clear violation of the Court's own ruling. Equally important, it was an indication of the degree to which the Agarwals have ingratiated themselves into the deepest reaches of India's polity and judiciary.

Unless the family's machinations are challenged at every step of the way, and wherever they manifest themselves, new Nyamgiris and latent Lanjigarhs are inevitable. 

Even the current struggles risk being lost.

[London Calling is published by Nostromo Research. Views expressed in this column do not necessarily represent those of any other party, including the editors of the MAC website. Reproduction is wecome, so long as Nostromo Research is accredited as the author, and all sources are quoted.]

Vedanta flouted forest conservation norms, says report

The Hindu

13 March 2010

New Delhi - Vedanta Aluminium has violated forest conservation guidelines and has failed to follow the Forest Rights Act in letter and spirit at a proposed bauxite mine project in the Niyamgiri Hills of Orissa, according to a report submitted by a three-member team to the Ministry of Environment and Forests.

After receiving allegations about the project earlier this year, the Ministry constituted the team - with a forestry official, a former government wildlife official and an independent sociology expert - to inspect the site and speak to all stakeholders. The team's report was considered by the Forest Advisory Committee of the Ministry on Friday, and the Orissa government was asked to provide an explanation for the violations, according to Jairam Ramesh, Union Minister of State for Environment and Forests.

The company has built an incomplete mine access road passing through both forest and non-forest areas and has constructed 47 pillars for a conveyor corridor before receiving clearances, in violation of the Forest Conservation Act guidelines, according to a site inspection by J.K. Tewari, Chief Conservator of Forests.

So far as wildlife was concerned, Vinod Rishi, former Additional Director General of the Wildlife Institute of India, has said that if no further diversion of forest land for mining is allowed, the Niyamgiri ecosystem would be able to recover.

It is the report of Usha Ramanathan from the Centre for Study of Developing Society, which is the most damning. She says that the Forest Rights Act has yet to be implemented in the area. The local Dongria Kond tribals have not been made fully aware of their land rights, nor have they been consulted about the mining project, because under the strict definition, they are not displaced people.

However, Dr. Ramanathan notes that "the disruption of their habitat and way of life...may lead to the destruction of the Dongria Konds as a Primitive Tribal Group." She also documents cases of repression of public opinion and dissent by both the company and local authorities and reports of pollution by Vedanta's nearby refinery. In fact, she says that Vedanta Aluminium's involvement in the project may itself violate a Supreme Court order.

"Vedanta flouting green norms in Orissa"

Express Buzz

13 March 2010

NEW DELHI: Multi-billion dollar mining giant Vedanta Resources has violated environment regulations at its Rs 50,000-crore project in Orissa giving a go-by to tribal rights, the government has said.

"I can say that they have violated Forest Rights Act, without taking consideration of the tribal rights," Environment Minister Jairam Ramesh said last night, adding the violation was both on the tribal front and also of the forest regulations.

Commenting on a ministerial expert committee that had gone into various mining projects in Orissa, he said Niyamgiri mining activities of Anil Agarwal led Vedanta had been found in violation of different regulations.

At the same time, he hit at campaigns launched by human right groups like Amnesty against the project as also its counter by the company through full page advertisements in national and local dailies.

A three-member team of the Union Environment Ministry submitted its report to the government yesterday, saying it has found evidence of violations of green norms at the company's bauxite project in the Kalahandi district of Orissa.

"I would not subscribe to the high-profile campaign in the case by various groups... I am looking at the case on merit basis," he said, adding the company had started construction work on land that belongs to the revenue department without necessary clearances.

'Vedanta infringed clearance guidelines'

Nitin Sethi

Times of India

13 March 2010

NEW DELHI: The high profile Lanjigargh bauxite mining by Orissa Mining Corporation, and involving the Sterlite-Vedanta group in Orissa, got caught in greater controversy with a committee of the Union environment and forests ministry raising serious questions about the violation of the rights of primitive tribal groups, other tribals, violation of forest laws as well as infringement of the terms of conditions laid down by the Supreme Court while permitting the mining.

The ministry accepted the report on Friday after its Forest Advisory Committee deliberated upon the report and recommended several actions.

The report was authored after a site inspection by two forest officials and Usha Ramanathan, a legal expert from the Centre for Study of Developing Societies.

While the forest officials looked at the violations of the forest and conservation laws as well as dangers posed to ecology, Ramanathan studied the impact of the project on the society.

Union environment and forest minister Jairam Ramesh said that there seemed to be prima facie violation of the clearance procedure as well as the Forest Rights Act.

He pointed out, on the basis of the report, that the mining corporation which is meant to provide the bauxite to Vedanta-Sterlite's aluminium refinery had violated the clearance guidelines by carrying on construction in the non-forest area before securing clearance for the forested lands from the ministry. The ministry guidelines disallow any activity even on the non-forest land of a project till forest clearances have been obtained.

Curiously, while the environment ministry released the reports authored by the two forest officers, it did not make public the Ramanathan report which is more scathing.

The Ramanathan report, sources in the ministry said, had pointed to gross violations and raised serious concerns about the impact of the project on the primitive tribal group -- Dongriya Kondh -- whose members are the traditional land owners of the Lanjigarh forest hills.

Sources said that Ramanathan had pointed to extremely shoddy rehabilitation carried out during the project. She also pointed out that the community rights of the primitive tribal group, which are provided special status under the Forest Rights Act, had not been addressed.

After a detailed public hearing, she had recorded that the primitive tribal community was clearly against the project, as it would destroy their livelihoods.

She had also pointed to the presence of Vedanta and not Sterlite in the project, which was violative of the apex court directions.

Sources said while the report pertaining to the impact on wildlife had been found to be `ambiguous', the report on forestry section had clearly pointed to violations.

The issues pertaining to tribal rights would be referred to the ministry of tribal affairs while the environment ministry would respond to the violations under the Forest Conservation Act and other laws under its purview, sources told TOI.

FAC DRAFT on Vedanta in Lanjigarh, Orissa

Draft of Report submitted by Ms. Usha Ramanathan's

11 February 2010


The visit included a meeting with a gathering of men and women at a point near Ijirupa
village. They were members of the Dongria Kond tribal communities who had reached
there from a number of villages including Palveli, Gortha, Pakeri, Sargipayo,
Dhongamati, Dengoni, Tahali, Kambesi (a village on the Rayagada side of the mountain) and Lakhpadar. Many of these are Dongria Kond villages. After hearing the views, anxieties and anger of the Dongria Konds gathered there, we walked to Lakhpadar village, stopping along the way at Paalberi village and Tadipula village.

The Dongria Konds are a primitive tribal group (PTG). At an estimated number of 7952
in the 2001 census - 3458 males and 4529 females --they are an endangered tribe. Their lives are intimately connected with the mountains, forest and forest produce.

They live by gathering roots, fruits and other NTFP and practice some agriculture. A "Vaidya Sangh" based in Bubhaneshwar identified 112 medicinal plants in Niyamagiri, valuable in the treatment of cancer, diabetes, leprosy, malaria, paralysis, hypertension among others. Cerebral malaria is endemic in this area, and it is widely acknowledged that the medicine administered by the Dongria Konds which they extract from the plants on the hill is more effective and reliable. (During our visit, at least three non-tribals, including the Collector, Kalahandi admitted to taking the tribal medicines as a more certain means of protection from cerebral malaria than any other.)

The Forest Rights Act (FRA) in the Dongria Kond area

The FRA is still in the process of being understood by forest dwellers, as also by the
administration, in the areas that we investigated. The FRA expects that recognition and
settlement of rights will precede any involuntary change in the conditions of the tribals
and forest dwellers. A recent case in the Andhra Pradesh High Court demonstrates the
lapses that may occur during the implementation of the FRA, especially in relation to
community and traditional rights. (Annexure)

The FRA and the Rules recognise PTG as a people requiring particular protection. This is
in keeping with the Constitution which recognises the right of protection and preservation of their way of life of Scheduled Tribes in a Fifth Schedule area. In Lakhpadar, we were informed that the Dongria Khond Development Agency (DKDA) has taken forms in connection with the FRA in October 2009, but the tribals were unaware of what that implied. They have not heard from the DKDA since, and are unclear what the settlement would mean to them.

The process of determination and settlement of individual, community and traditional
rights has not been completed yet. It is also evident that the Dongria Konds have only a sketchy notion of the rights to which they may lay claim under the FRA. In none of the
villages that we visited was there understanding about how to delineate, and claim,
community and traditional rights. However, the Dongria Konds evinced a strong sense of habitat, and of the mountain which is their abode, the source of their sustenance and their sacred space. The top of the mountain belongs to Niyamaraja, which is where they congregate to worship - thirteen times each twelve months, they said.

Until these, and allied rights are recognised and recorded under the FRA, their habitat
cannot be disturbed.

‘Displacement' of Dongria Konds

The company and the Orissa Mining Corporation (OMC) informed us that there would be no displacement involved in the mining project since no one lives on that stretch of the mountains.

This statement rests on the definition of `displaced families' and ‘families affected but
not displaced'.

Para 1.2 of the Rehabilitation and Resettlement Policy for the Displaced and other Project Affected Families for Establishment of Alumina Refinery by M/s Sterilite Industries (India) Ltd. near Lanjigarh, Kalahandi, Orissa that pertains to the VAL, provides the definition that has been used to identify displaced family in relation to the Alumina Project:

"1.2 A family/person shall be termed as `displaced' and hence eleigible for rehabilitation benefits if such family/persons has been a permanent resident of Orissa and ordinarily residing in the project area for at least 3 (three) years prior to the date of publication of the notification u/s 4(1) of Land Acquisition Act 1894 and

(a) on account of acquisition of his/her homestead land is displaced from such area or

(b) he/she is a homesteadless or landless family/persons who has been/is required to be displaced.

Note: (i) The `project area' means the land which is acquired for establishment of
industrial projects.

(ii) The persons/family who does not ordinarily reside in the homestead land acquired for this project cannot be termed `displaced'.
Para 12: Definition of other project affected persons/families (PAPs): A person/family
will be termed as `project affected person/family' if his/her land (not homestead land) is acquired for establishment of the industrial project. These persons are therefore affected by the establishment of the project by way of acquisition of their private land but are not required to be displaced as their homestead land is not acquired.

It is by extending this definition to the mining project area that it is claimed that there are no displaced or project affected persons or families.

Dongria Konds however perceive it differently. There are no villages in the mining area,
they said. But there are over 200 villages on the sides of the mountain. They will all get
affected by the road, the vehicles, the mining and the drying up of the streams. Mining
will bring many people into our area who know nothing about us or how we live. The
wildlife is already affected by the activity, and the roads. Our lives are closely linked to
the wildlife here, and as that disappears, our lives will get destroyed. Our medicinal
plants and fruits and roots will get affected by all the comings and goings on the
mountains and the conveyor belt that will pass through our territory. The ‘dongar' where we worship our Niyamaraja will be dug up and blasted.

These are aspects that are integral to the lives of the Dongria Konds, and do not appear to have been considered while deciding to open up the mountain top for mining. While some of their concerns may be met by the assessment made by expert bodies such as the CMPDI which has made a projection of the effect of mining on water, there are no studies and no assessments about the other threats that they see themselves as facing. This acquires importance in the context that disruption of the habitat and the way of life of this PTG cannot be remediated nor compensated, and may lead to the destruction of the Dongria Konds as a PTG. This is too serious a consequence to ignore.

There is unrest palpable among the Dongria Konds. Uncertainty and anger, that the entry of the company could mean an end to their lives as they know it, and so to their very survival, was in evidence. These concerns need to be addressed.

The team is concerned that no experts have been brought in to assess the implications of the project for the Dongria Konds.

The team's observations during the visit are that -

-the Dongria Konds are not ready for an ecological shift.
-they have not been consulted about the project, because they have not been
counted among the project affected
-their ‘poverty' is relative, and their subsistence in their natural state is not
threatened by the kind of poverty that we saw in the plains
-they want development, especially schools but from the government which, they
say, has shown no interest in them till now, and, now, only to have them make
way for the company.

Specifically, our attention was drawn to Section 3 which requires the right over habitat
and habitation of PTGs:

Section 3(1)(e): "[r]ights including community tenures, habitat and habitation for PTGs
and pre-agricultural communities."

Section 3(1)(i): "[r]ight to protect, regenerate or conserve or manage any community
forest resource that they have been traditionally protecting and conserving for sustainable use."

Section 3(1)(k): "[r]ight of access to biodiversity, and community right to intellectual
property related to biodiversity and cultural diversity."

Section 5 of the FRA, inter alia, empowers the holders of any forest right ...
"(c) to ensure that the habitat of forest dwelling Scheduled Tribes and other traditional
forest dwellers is preserved from any form of destructive practices affecting their cultural and natural heritage."

The absence of SIIL [terlite Industries India Ltd]

During our visit to Lanjigarh and the site, the team met, and held discussions with,
officials of VAL. Two power point presentations, about the aluminium refinery project
and the proposed mining project, were made by the Chief Operations Officer of VAL and his associates. We were not informed of the presence in our midst of any representative of SIIL, nor were we met by anyone who was introduced as an official of SIIL at any time during the visit.

This acquires significance in the context of the Supreme Court order dated 23/11/2007 in the matter of TN Godhavarman Tirumulkpad. The court quoted an extract from an
economic daily which, inter alia, read: ‘"Vedanta Resources is accused of having caused
environmental damage and contributed to human and labour rights violations', the ethics council said." "We do not wish to express any opinion on the correctness of the said Report", the Supreme Court said. "However, we cannot take the risk of handing over an important asset into the hands of the company unless we are satisfied about its credibility."

Setting out a series of facts and circumstances in relation to M/s VAL, the Court
concluded: " .... keeping in mind the totality of the above factors, we are not inclined to clear the project."

"Liberty is, however, given to M/s SIIL to move this court if they agree to comply with
the following modalities as suggested by this Court. It is made clear that such an
application will not be entertained if made by M/s VAL or by Vedanta Resources."

The modalities included the setting up of a SPV for Scheduled Area Development of
Lanjigarh Project.

The order of the Supreme Court dated 8/8/2008 by which the forest diversion proposal
for diversion of 660.749 h.a. was granted was "in matter of M/s Sterilite Industries
(India) Ltd."

Against this backdrop, that Dr. Mukesh Kumar, Chief Operations Officer, Vedanta
Alumina Ltd. (VAL), was our interface with the company interested in the mining lease
could acquire significance. The powerpoint presentations on 22/1/2010, 28/1/2010 and
31/1/2010 on the aluminium refinery and on mining plans was presented at the Vedanta Guest House by Vedanta personnel. It may bear emphasis that no official of SIIL was introduced in the proceedings, nor do we have reason to believe that any was present.

In the "Minutes of Meeting of First Board Meeting of LPAD Foundation held at the
office of Revenue Divisional Commissioner Office, Brahmapur, Orissa at 12 noon on 14
October 2009," Dr. Mukesh Kumar is represented as a core functionary.

These circumstances suggest that there is a violation of the Supreme Court's orders.

Given the seriousness with which the Supreme Court considered the disinvestment by,
and observations of, the Norwegian Fund, the FAC may have their attention directed to a recent decision taken by the Church of England to dispose of its investment in Vedanta Resources on grounds that "we are not satisfied that Vedanta has shown, or is likely in future to show, the level of respect for human rights of local communities that we expect" and that maintaining investments in Vedanta "would be inconsistent with the Church investing bodies' joint ethical investment policy" as its reasons. Martin Currie Investments sold their GBP 2.3 million stake last year. BP's pension fund reduced its holding in Vedanta citing "concerns about the way the company operates." In October 2009, UK government ruled that Vedanta "did not respect the rights of the Dongria Kond." On 19th February, 2010, it has been reported that United Kingdom-based Joseph Rowntree Charitable Trust was selling a £2.2 million stake (along with other investors who follow its ethical policy) in Vedanta. "We have heard first-hand about Vedanta's environmental and human rights abuses in Orissa and believe that Vedanta is pushing industrialisation to the detriment of the lives and lands of the local people. This behaviour may be legal, but is morally indefensible," Susan Seymour, chair of the investment committee at the Joseph Rowntree Charitable Trust is reported as having said.

It appears, from correspondence that was made available to us, that the district
administration, too, has not paid heed to the Supreme Court's orders. A letter/fax. no.
658/Res dated 16/11/2009, from the "Collector Kalahandi-cum-Director, LPADF,
Lanjigarh" to the "Director, National Rural Health Mission, Orissa, Bhuwaneshwar",

No. 658/Res Dated the 16th November, 2008

This is in continuation of my letter No. 657/Res dated 15.11.2009 about the
Lanjigarh Area Hospital. As mentioned, there is local opposition to the proposal
of handing over the Lanjigarh Area Hospital to M/S Vedanta Alumina Ltd.,
Lanjigarh and withdrawing the Government staff. However, it is imperative for
the welfare of the people of that area that the Hospital should be provided
adequate infrastructure and personnel. The Lanjigarh Project Area Development
Foundation (LPADF), a Special Purpose Vehicle formed by the order of Hon'ble
Supreme Court has already allotted Rs. 3.00 Crore for the Hospital. M/S VAL has
already identified an NGO for day-to-day running of the Hospital. At this juncture
handing over the Hospital to M/S VAL may not be desirable in view of the public

I had a discussion with Dr. Mukesh Kumar, Chief Operating Officer of M/S VAL
in the matter. He suggested that instead of the present Bilateral Agreement
between M/S VAL and the CDMO, Kalahandi about the Hospital, a Tripartite
Agreement be signed among M/S VAL, LPADF and the CDMO, Kalahandi. The
Hospital may be handed over to the LPADF for infrastructure development and
M/S VAL would provide personnel for day-to-day running of the Hospital. The
Agreement may also provide for further contribution from M/S VAL towards
infrastructure or from LPDAF for day-to-day running. The Collector, Kalahandi
in his capacity as the Director of the LPADF may take over the Hospital and start
the development works.

The FAC may need to consider the consequences of this continuance of VAL in the
mining project and in the SPV created pursuant to the Supreme Court's order which
expressly excluded Vedanta Resources and VAL, while permitting SIIL to be a party to
the project and to the SPV.

The impact that VAL has had on the population in the vicinity of their plant and on the
surrounding area was considered during the team's visit. This acquired relevance for a
variety of reasons:

-the work on the conveyor belt and on the road linked to the mining area with the
premises of the VAL.
-the acquisition included land required for the VAL project and for the Mines
Access Road, as is clear from a "Memorandum of Settlement between the M/S
VAL and the villagers of Rengopalli ..." [see Annexure]
-although SIIL was directed by the Supreme Court to be the contracting and
performing party, it is VAL and its officers who are the functionaries on site,
including in relation to the SPV that has been set up by order of the Supreme
-the capacity to anticipate, and pre-empt, problems that the people living in the
vicinity may face could be assessed.
-VAL's proposal to expand its plant capacity six-fold will have a direct impact on
the mining activity, and its fall-out, if any.

The team visited two villages which are situated close to the plant and which have
approached the SHRC complaining of increased morbidity and mortality, loss of cattle,
irritation in the eyes and noise population.

Rengopalli village is situated close to the Red Mud Pond. At the early stages of the
alumina refinery project, VAL sought to have the land in the village acquired to build its
Red Mud Pond, boundary wall for its aluminia refinery and to construct the Mines
Access Road. This village is mainly populated by the Kutia adivasis. During our visit,
they told us that 13 people had died of TB in the preceding two years. 200-250 cattle and goats had perished. They complained that the dust from the factory and the toxicity in the air near the Red Mud Pond was causing them inconvenience, ill health and irritation in the eyes. When the Collector, Kalahandi, visited the village on the direction of the SHRC, he too reported that the red mud pond was indeed causing irritation in the eyes. [Annexure of SHRC proceedings]

The villages of Rengopalli had been unwilling to be displaced when land was being
acquired for VAL. Their agricultural land had been acquired for the project, while they
had stayed on in their homesteads. They had used the compensation amount to buy land at Muniguda: a distance from their homestead that prevents them from undertaking cultivation, so they have given it for share cropping. The expansion of the Red Mud Pond is taking away the road that the children use to reach their school, and that was also causing them concern.

Despite the villagers having written to the SHRC, and the Collector being brought into
the matter, it is striking that there is no mechanism that has been set in place to monitor the health and mortality of the persons living in the vicinity of the pond and the factory. There has been no effort to stem the immiseration that is visible in these villages.

The condition of the villagers in Bandhaguda village, which borders the plant, is not very different. We were told that they too had resisted acquisition and eviction, had lost their agricultural land to acquisition, and were now on homesteads with no means of making a living.

In both villages, the inability to find employment, and the effects of the pollution, is
driving them to demand that they now be displaced and rehabilitated. The demand flows out of an expectation that they too may get rehabilitation sites and structures and a job for one member of their families. Of the 120 families who were treated as `displaced' by the project, and who have been housed in the rehabilitation colony, 68 have been given employment, and that is the cause for the optimism. It was clear that this was choice born out of hopelessness. They complained that the company was now refusing to acquire the land and treat them as displaced people.

It is these two villages that have taken their case to the SHRC; but there are other villages where the fall-out of the setting up of the plant is being experienced. In Chatrapur village, again situated along the boundary of the plant, 40 families belonging to the Scheduled

Castes and Scheduled Tribes complained of dust pollution. A railway siding being
constructed to carry coal to the plant was resulting in their land getting waterlogged, and they complained that it was they who had to bear the consequences. They too demanded to be displaced, and rehabilitated, with jobs in the company. In Basantgun village, along the plant's perimeter, they complained that they had to suffer the pollution, but they were not getting the jobs.

Kotdwar is a village with a Scheduled Caste population. They are project affected in that their land has gone to the company. This cluster of 20 houses is up against the boundary wall of the factory and resembles an industrial slum. They said they had an agreement with the Collector that they would get jobs for the land they had to give up; but nothing has happened. The water is contaminated in our hand pumps, they said, and people fall ill. Goats and cattle have died eating the grass but the administration says that they must have died of old age.

They showed us an "Identity Card" that had been issued to them by VAL and the
Collector. It had a column indicating the "[n]ame of the member of the family nominated
for employment/training/self-employment" and carried a note "[t]his card is issued as per the provision of the approved Resettlement and Rehabilitation Policy of the Government of Orissa for the establishment of Aluminia Refinery Project at Lanjigarh and the contents are subject to change whenever necessary." On the strength of this joint assurance from the company and the Collector, they were expecting to be employed by the company. The company told us that there are an estimated 1822 PAFs, in three phases. 110 had applied for training and had been sent to be trained. There are contractors to whom many of the tasks had been outsourced, and, according to the company, the PAFs were unwilling to work with the contractors and were insisting that they be absorbed by the company, which was impractical.

The loss of land, the proximity to pollutants, and the inability to access jobs despite what they understood to be a promise that a job would be provided to the designated person has left these villagers in an unenviable situation.

Especially given that the logic of industrialising the region was based on improving the
conditions of the people; that land loss linked with unemployment is a prescription for
immiseration; that these are villages peopled by Scheduled Castes and Scheduled Tribes and that it is in a Fifth Schedule area; the poverty, joblessness and pollution and its effects cannot be treated lightly.

No mechanism has been set in place to monitor matters of

-effects of the developments in and around the plant, including matters such as
water logging, the loss of an easementary way (to the school from Rengopalli)
and connected matters.

Forest Rights Act (FRA)

The settlement of rights under the FRA is incomplete even beyond the Dongria Kond
villages. There was a lack of awareness especially about community rights, including
rights to grazing land, land for haat and for places of worship. In Panimunda village on
the Rayagada side of the mountain, for instance, where we met members of the Kondo
Tribe and others belonging to a Scheduled Caste (Dumbo caste), they said they had
applied for ‘dangar' land, but did not otherwise understand the notion of community land that is in the law.

A number of those we met complained that they had taken their families to file their
claims under the FRA, but they had been turned away because they had not appended a photograph of the rights seekers. We were given an extract from the register containing the Minutes of Sub-Divisional Committee, Kalahandi, of proceedings dated 6/6/2009 of the SDLC concerning implementation of the FRA. The information to be gathered about the applicant was set out, and read.

"1. Each call record produced by FRCs mush have joint enquiry report signed by the
representative of Forest, Revenue and SSD Department.
2. Joint photograph of couple.
3. Voter ID Cards of head of family/applicant.

4. Original sketch map of the land occupied alongwith _________ (illegible)."

The Minutes record that cases "are pending due to want of joint photographs of the
couple which will be collected very shortly." This additional requirement is not provided
for in the Rules, and has acted as a barrier to applying under the FRA. This is one
instance of what is slowing down the process of recognition and settlement of rights. The Minutes also reflect the lack of attention to community rights.

These are serious imperfections in the FRA process. A review of the implementation of
the FRA clearly is needed. This is a Fifth Schedule area, dominated by tribal
communities and by members of Scheduled Castes. The FRA was enacted to recognise
and settle individual, community and traditional rights of tribals and other forest dwellers.

Before any further change to the status of this population is proceeded with, the FRA
must be implemented, in letter and spirit, if injustice to these communities is to be

Curbs on questioning the project and its effects

Displacement, loss of livelihood, pollution, non-payment of compensation for land and
objections to the project and its effects are some of the causes for discontent and protest. The reaction to the protest has been in the form of

- an agreement which abjures the villagers from opposing the activities of the
- arrest and detention by the police and being let off on bail with an undertaking
taken from the villagers saying: "I will not protest again."

The "Memorandum of Settlement between M/S Vedanta Aluminia Ltd, Lanjigarh and the
Villagers of Rengopalli, Lanjigarh Block of District Kalahandi, Orissa this 28th day of
June 2006" is an instance of the curbs that are being introduced by "agreement." [see

"The residents of Village Rengoppali had raised certain issues pertaining to their land
acquisition and compensation and development of their village. Vedanta wants to build
its Red Mud Pond and boundary wall for its Alumina refinery and also to construct the
Mines Access Road which will pass through the village of Rengopalli. The villagers of
Rengopalli were not accepting the land payment and opposing the construction of the red mud pond and Mines Access Road."

By settlement, therefore, it was recorded that

"1. The people of Rengopalli will unconditionally accept the land payment and will not
directly or indirectly oppose the construction of Red Mud Pond boundary wall and the
access road and whole heartedly cooperate, participate in construction in a peaceful

They will continue to cooperate the company in all their future activities for construction
and operations of Vedanta's Alumina refinery. They will not raise any future issues,
which will materially affect the construction and operation of Alumina refinery. Any
demands raised by Rengopalli villagers shall be only routed through the village coordinator to be nominated by Vedanta and they will not resort to any pressure
techniques/strikes/stoppage of work/threatening etc."

In return, VAL agreed, inter alia, to "provide appropriate training facilities to the eligible
PAPs to acquire skills and provide employment as per provision of Resettlement and
Rehabilitation policy of Government of Orissa approved for Lanjigarh Project."

The villagers of Rengopalli conveyed to us that it was this promise of jobs for which they had been waiting. Twenty-five youth had taken training, but had not been employed. Their understanding was that the twenty-five should have been employed by the company, and they did not see how to get the company to honour the agreement.

The ‘settlement' is steeply slanted in favour of the company and has the stated purpose of stifling protest and the expression of discontent. Since then, as has been observed earlier in this report, the villagers of Rengopalli have approached the SHRC in connection with matters concerning health, pollution and the access road to the school.

These villages are populated by adivasis and Scheduled Tribes. Rengopalli's habitants
belong to the Kutia Kond adivasi tribe. Their agricultural land has been acquired for the
refinery, and the homestead remains with them. That too is in jeopardy when the Red
Mud Pond is expanded.

This Memorandum of Settlement is contrary to public policy as per section 23 of the
Contract Act. Expressions of dissent and difference are forms of democratic expression,
and these cannot be curtailed by agreement. This has been explained by the Madras High Court in Dow Chemical International v. Nithyanandam, International Campaign for
Justice in Bhopal, Bhopal Group for Information and Action, Bhopal Gas Peedit Mahila
Stationery Karamchari Sangh, Bhopal Gas Peedit Mahila Purush Sangharsh Morcha,
Greenpeace International and one other, O.A.395-397 of 2009 in Civil Suit No. 356 of
2009, order dated July 9, 2009 in the Madras High Court.

These are important cautions while dealing with the rights of adivasis and Scheduled
Caste populations who are facing disruption of their lives and livelihood. Democratic,
and constitutional, means have to be deployed in taking a project forward. This is why
the involvement of the gram sabhas, holding public hearings, and practising the
requirements of Free Prior Informed Consent has become central to project functioning,
especially in adivasi areas. The imposition of these conditions violate the fundamental
rights of the villagers of Rengopalli.

The team was met by villagers at Kadampura Chowk, and villagers from Bandhguda,
Kotdwar and Dhadel who have been detained, charge-sheeted and are currently facing
trial following protests against the company, demanding rehabilitation, employment and other similar concerns. The issues of land, livelihood, and immiseration is being
converted into issues of law and order. While one aspect of these protests are in the realm of law and order, the treatment of these protests as offences in criminal law distorts the situation on the ground.

This "burden of criminality", a lawyer told us, disables the tribals and Scheduled Castes
of the area from pursuing their rights. This, he said, itself constitutes a violation of
fundamental rights of the adivasis and Scheduled Castes in this Fifth Schedule area. In
many instances, protestors were booked on false cases to silence them, we were told.1

These are serious allegations, and must be probed to ensure that the power of the law is not abused.

1 See, for instance, statement of Kumuti Majhi of Sudhibali village at the Public Hearing for expansion of the Alumina Plant held on 25/4/2009: "He stated that he gave everything to the VAL but still they are neglected. Whenever they raise the objection they are booked on false cases."

Also, against the background of the circumstances that have emerged since the first
protests that are on trial, especially the immiseration that we witnessed in the villages
around the plant, there is weight that must be attributed to the lawyer's contention.

If the administration is unable to address the protests otherwise than as acts of
criminality, it does in fact result in a violation of the rights of the displaced and project
affected villagers.

Public Hearing

There has been no public hearing in relation to the mining project after 2003. In 2003, it was held at the PWD Inspection Bungalow, Muniguda, Rayagada District on 17/3/2003, and at the Office of the Special Officer, Kutia Kandha Development Agency, Lanjigarh, Kalahandi District on 7/2/2003. These were hearings in relation to the "proposed alumina refinery captive power plant and bauxite mine." The validity of a public hearing for a project does not however extend beyond five years. This means that a public hearing will have to be held before any decision can be made about permitting mining in the mining lease area.

The public hearing held on 25/4/2009 in relation to the "expansion of Alumina Refinery
Capacity from 1.0 MTPA to 6.0 MTPA at Lanjigarh in the district of Kalahandi" has

been recorded, and it is annexed to this Report. [Annexure] Twenty seven (27) persons spoke at the public hearing. Each of them spoke about the dust pollution, the non-provision of employment, non-performance of the promises made by VAL when they took their land for the refinery, the diseases that pollution brought with it. Except one speaker who is recorded as only having spoken to welcome the project, the twenty six (26) others were agitated by what they saw as having transpired since their lands were acquired and the refinery set up. The conclusion, highlighted in the report of the proceedings, however, reads:

"The overall opinion of the public about the project was favourable, provided the
proponent takes care of their issues."

It was represented to us that this conclusion could not flow from the anger and disillusion that was witnessed at the meeting, and reflected in the words of those who spoke at the public hearing. A CD of the public hearing testifies to the mood of the speakers having been predominantly defiant.

There was anxiety expressed that, were a public hearing to be held on the mining project, the conclusion may likewise be shown as positive even if the sentiments expressed were to the contrary. It was suggested that, before the FAC relies on the conclusion proffered about a public hearing, it view the proceedings on camera and the views of the people, and itself assess whether the conclusion follows from the proceedings.

Government agencies as beneficiaries

It was pointed out to us that there are instances where a government department has received material assistance from VAL, and that this could detract from the neutrality ofthe government department. As an instance, it was pointed out that two rooms had been added to the BDO's office in Viswanathpur, and furnished, by VAL as a resting place for the Collector when he travels on duty.

This is a disturbing state of affairs and needs to be checked if the neutrality of the state is to be maintained.


Usha Ramanathan

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