Plunder & profit

ON June 16, the Government of India constituted a Group of Ministers (GoM) to address the issues thrown up by the draft Mines and Minerals (Development and Regulation) Bill, 2010, formulated by the Ministry of Mines. The GoM was set up ostensibly to look into the sharp differences among key Ministries such as Law and Steel over the draft Bill, but the sequence of events that led to its formation brought into focus the myriad problems in the mining sector.

Experts and observers are unanimous in pointing out the contrasting perceptions and conflicting interests within the government and outside that dominate this sector, leading to lax or near-absent regulatory mechanisms, which in turn cause environmental degradation and large-scale displacement of people.

In this chaotic situation, corporates and other business-industrial entities thrive, pursuing legal, extralegal and illegal mining or a combination of all three. This context, characterised by the unbridled pursuit of wealth by a few individuals and organisations at enormous environmental, social and human cost, has also led to the growing alienation of tribal and other indigenous people in the mining areas and to extensive Maoist penetration of these localities.

It is a moot question whether the GoM will be able to address this overall context. For, instances abound where the very agencies responsible for bringing in regulation and ensuring its compliance have been found to dither either by design or on account of negligence.

Barely three weeks before the GoM was formed, the Naveen Patnaik-led Biju Janata Dal (BJD) government in Orissa was asked by the Supreme Court to explain why it had allowed 215 of its 341 working mines to operate without statutory government clearances or even a proper mining plan. The Central Empowered Committee (CEC) set up by the apex court to look into complaints about these mines was the one that came up with this piece of information in its report.

The Orissa government is not alone in this criminal negligence to ensure that rules and regulations are followed. A number of government agencies have estimated that there are about 15,000 illegal mines spread across the country as against 8,700 legal mines. In several parts of the country, the boundaries between legal and illegal mining merge seamlessly. In such situations, an individual or a corporate entity engages both in legal mining with approvals and licences, and in illegal mining, more often than not with political and bureaucratic patronage.

A case of seamless merger of legal and illegal mining was unravelled when Madhu Koda, the former Chief Minister of Jharkhand, was arrested in connection with a Rs.4,300-crore scam. More blatantly, the Gali Reddy brothers Karunakara Reddy, Janardhana Reddy and Somashekhara Reddy of Bellary district in Karnataka developed their own political clout in the State and in Andhra Pradesh with the wealth gained from aggressive mining.

Karunakara Reddy and Janardhana Reddy are now Ministers in the Bharatiya Janata Party (BJP) government in Karnataka. They had tremendous influence over the Y.S. Rajasekhara Reddy-led Congress government in Andhra Pradesh, too.

Breach of obligations

A recent study by Amnesty International on the Vedanta group's operations in Orissa the construction of the Lanjigarh alumina refinery and prospective mining of the adjacent Niyamgiri hills asserted that both the State and the Central government had breached obligations to respect and protect the human rights of the Dongria Kondh and other communities affected by mining and refinery projects. It also pointed out that though the Orissa government and its pollution control board had undertaken regular monitoring of the refinery, they had failed to enforce laws to prevent the contamination or pollution of water and air, leading to violations of the right to water and health of the affected communities.

In Chhattisgarh, the Raman Singh-led BJP government is said to have scrapped in 2006 a proposal for an elephant reserve in order to facilitate coal mining by a number of industrial houses. The proposal was scrapped after it was found out that about 100 square kilometres of a coal block fell within the proposed reserve. Ironically, the elephant reserve was originally conceived to house elephants migrating from Jharkhand and Orissa on account of the increase in mining in those States.

The scale of political and bureaucratic assistance provided to mining corporates and their associates is perplexing in many cases. In Maharashtra's Ratnagiri district, which is a major producer of the Alphonso variety of mango, a government-sponsored study on the environmental impact of a thermal power station being set up by a steel major ruled out any hazard from the plant to mango orchards. It even stated that orchards near major roads with heavy vehicular traffic seemed to be healthier than those situated further away and suggested that the emissions from the thermal plant may actually improve the plantations in its vicinity. The impact of wanton support to individual and corporate entities involved in mining throughout the country has been delineated at length in Rich Lands, Poor People, a seminal report brought out by the Centre for Science and Environment (CSE) in 2008. The extensively researched report addressed the issue of mining in different States and its impact on the environment and people.

Devastation, displacement

The report presented a horrific picture of the devastation brought about by mining in the country. It pointed out that in the first four and a half decades of Independence mining had displaced about two and a half crore people and that not even 25 per cent of them had been rehabilitated. Of the displaced people, more than half were from tribal communities.

The report calculated that for every 1 per cent of the mining sector's contribution to the country's gross domestic product (GDP), the activity displaced three to four times more people than all development projects put together. The report also stated that increase in mining activity in recent years had led to an increase in the diversion of forest land. An estimated 1.64 lakh hectares of forest land has already been diverted for mining in the country. Iron-ore mining in India used up 77 million tonnes of water in 2005-06, enough to meet the daily water needs of more than three million people. Mining of major minerals generated about 1.84 billion tonnes of waste in 2006 most of which has not been disposed of properly. Coal is the main culprit: every tonne of coal extracted generates three to four tonnes of waste. The report also pointed out that air and water pollution is also on the rise in the mining hotspots.

According to Sanjay Bosu Mullick of the Ranchi-based Bindrai Institute of Research Study and Action (BIRSA) and the Jharkhand Mines Area Coordination Committee (JMACC), the spread of Maoist extremism in many parts of the country is the result of this large-scale ravaging of natural resources. This plunder is leading to growing conflicts in India's mining zones and informal estimates are that nearly 60 per cent of the country's mineral-rich districts are under the influence of Maoist activity, he says.

A number of bureaucrats and non-governmental activists involved in studying and observing mining-related activities pointed out that the socio-economic climate of liberalisation and globalisation had contributed to this excitement to help corporate players and their interests. That is a factor that has to be looked at comprehensively, said a senior bureaucrat.

But according to Minister of Mines Bijoy Krishna Handique, the MMDR Bill is the product of comprehensive analysis and thinking and will address all the issues and problems relating to the mining sector. In his view, nobody can run away from the need for reform and modernisation in the mining sector and this, he believes, can be brought about only by encouraging investment. He adds that the social costs of the mining projects will be met by ensuring greater involvement of the local community in the projects and making it legally imperative for the miners to provide 26 per cent of the profits to the local community. He avers that the passage of the MMDR Act will strike a blow for sustainable mining (see interview).

While there is an acceptance that the Bill does seek to come up with new laws, it has been criticised as not being as comprehensive as Handique and his associates in the Ministry claim it to be. This criticism has emanated from within the government and outside.

Objections to Bill

The principal objections to the draft MMDR Bill have come from the Ministry of Steel. It has found fault with the proposal do away with the need for prior approval from the Central government. The Ministry of Minerals is of the view that the prior appraisal as it exists today is a mere formality, with all the real powers of approval being vested in State governments. According to the Ministry of Steel, this stance will trigger serious trouble for the mining sector as the mineral-rich States will be at liberty to grant concessions on their own.

The Law Ministry, too, has expressed reservations and has suggested a change in the nomenclature of the Bill with the objective of highlighting the environmental conservation aspect.

A number of social activists and NGOs have questioned some of the basic premises in the Bill. The NGO Mines, Minerals and People (MMP) has submitted a detailed proposal on the MMDR broadly following its charter, which has sought announcement of a complete moratorium on new mining projects in greenfield areas, legally enforceable right to natural resources to local communities, prevention of disinvestment of public sector mining companies in favour of private and multinational companies, ensuring the right to mining for indigenous people and their cooperatives, and prohibition on granting of lease to global mining corporates or their joint ventures.

It has also demanded that the issues of compensation and resettlement and rehabilitation be clarified with the formulation of specific rules with guidelines and manuals.

The CSE report, which conceded that mining and minerals were necessary, stated thus: Mining cannot be sustainable or truly environment-friendly: one, because all ore bodies are finite and non-renewable and two, because even the best-managed mines leave environmental footprints.

The real issue is about how mining has to be undertaken in an environmentally and socially acceptable manner. There is little doubt that legislation alone will not ensure this as long as the nexus between politicians and corporate interests remains strong.