Economic Times, June 29, 2010
NEW DELHI: Plans by Vedanta Resources to mine bauxite in Niyamgiri to feed its aluminium refinery in Orissa could fructify after years of delay and allegations of violation of tribal rights and environment norms by the promoter of the project. The Prime Minister’s Office (PMO) has written to the environment ministry to give clearance to the project after “a through scrutiny by the expert appraisal committee and due consideration of all aspects,” a top government official said.
The environment ministry is likely to take a final call on the fate of the project possibly within three weeks, an official in the ministry said. One of the options it is evaluating is to give conditional clearance to the project with higher net present value for the forest land and greater safeguards to protect the Dongria Kondh tribe. Another option being considered by the environment ministry is to challenge the studies on forest and wildlife impact, arguing that they were shoddy.
Vedanta Resources said in a statement that it is the “affected party” and has been complying with all statutory guidelines. It did not comment on the clearance for the project by the PMO. Environment minister Jairam Ramesh did not respond to phone calls and text messages. A report by two members of the study team sent by the Forest Advisory Committee, the nodal agency for all forest and environment clearances, said earlier this year that there were no forest or environment issues related to the project and, therefore, it should be given the go-ahead. However, the report had pointed out that issues relating to tribal communities need to be addressed.
Usha Ramanathan, a member of the team, had flagged the poor implementation of the Forest Rights Act, 2006, and the deleterious impact of the project on the local primitive tribal group, the Dongria Kondhs. It was on this issue that the environment ministry had withheld the clearance.
But now, the tribal affairs ministry has told the environment ministry that it has been informed by the Orissa government that the Forest Rights Act has been implemented by the company. The tribal affairs ministry has not raised objections to the project and neither has it communicated any reservations about it to the PMO, an official in the ministry said.
Given this fact, the environment ministry would have little choice but to give a go-ahead since issues relating to relief and rehabilitation (R&R) and tribal rights don’t fall within its domain. “There also seems to be a perception that the environment ministry is possibly exceeding its brief. It should just be concerned with environment and forest issues. Other issues relating to R&R and tribal rights are not under its jurisdiction. It’s for the ministries concerned to take a call,” said a senior government official.
The bauxite mining project is crucial for Vedanta Resources. Uncertainty in getting forest clearance for bauxite mining has forced it to delay listing plans for Vedanta Aluminium, a subsidiary.
Despite the global spread of its operations, the bulk of Vedanta’s revenues and profits originates from India. Sterlite, its flagship Indian arm, is 52% owned by the promoters, the Agarwal family. Institutional shareholders include MFs like UTI, which own 3.5%, insurance companies (3.9%) and FIIs (14.5%).
A coalition of NGOs and activists, foreign and Indian, has for long carried on an unremitting campaign against plans by Sterlite, the Indian arm of Vedanta, to mine bauxite in Orissa. The mining activities were approved by the Supreme Court in 2008, though the company is yet to receive final regulatory approval from the environment ministry.
Activists allege that bauxite mining in Niyamgiri would destroy the environment and displace the tribal community.
A senior Sterlite official, who spoke on condition of anonymity, saw the hands of what he described as “foreign mining giants” behind the activities of the NGOs. Shareholder meetings of Vedanta in London have routinely attracted demonstrations by activists and tribal people from Orissa who are allegedly facing displacement.
Given this fact, the environment ministry would have little choice but to give a go-ahead since issues relating to relief and rehabilitation (R&R) and tribal rights don’t fall within its domain.
“There also seems to be a perception that the environment ministry is possibly exceeding its brief. It should just be concerned with environment and forest issues. Other issues relating to R&R and tribal rights are not under its jurisdiction. It’s for the ministries concerned to take a call,” said a senior government official. The bauxite mining project is crucial for Vedanta Resources.
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