In a setback to its plans, metals and mining major Vedanta Resources today failed to get environmental clearance for its $1.7-billion (Rs 7,820-crore) bauxite mining project in the Niyamgiri hills of Orissa.The ministry of Environment and Forests rejected Stage-II forest clearance for the project in Lanjigarh, Kalahandi and Rayagada districts.
“Since forest clearance is being rejected, the environmental clearance for this mine is inoperable. There have been no emotions and no politics and no prejudice involved in this report. I have taken this decision in a proper, legal approach and not because Niyamgiri is sacred,” said Environment Minister Jairam Ramesh, while announcing his decision today.
Vedanta, through subsidiary Sterlite India, has a joint venture agreement with Orissa Mining Corporation to mine the Niyamgiri Hills for bauxite. It has been awaiting permission to develop reserves of the ore used to make aluminium for more than four years. In June, the environment ministry started investigating the impact of mining on tribes and wildlife in the area.
Shares of Vedanta Resources fell to a 10-month low in London trading. They dropped as much as 7.61 per cent to 1,882 pence (at around 11 pm IST). Sterlite Industries, which owns around 30 per cent in Vedanta Aluminium, fell by 4 per cent to Rs 152.40 on the BSE.
The decision to reject the proposal comes after the Forest Advisory Committee (FAC) submitted a report to Ramesh after reviewing suggestions of the N C Saxena panel, which sought a ban on the project in view of various violations at the site. The Saxena committee said a mining lease would result in loss of habitat of rare flora and fauna, destroy an elephant corridor and endanger a large chunk of the Dongaria Kondh tribal population.
Besides it would violate the Forest Rights Act and the Forest Conservation Act, it added.
The panel also recommended action against Vedanta alumina refinery at Lanjigarh for illegally encroaching and enclosing 26 hectares of forest land, despite earlier environmental clearance given on condition that no forest land would be used. The refinery’s capacity increased from 1 million tonnes a year to 6 million tonnes without requisite clearances. Moreover, it currently sources bauxite from 14 mines, of which 11 do not have environmental clearance and have been deemed illegal by the government.
“This matter is being examined separately. Further, a showcause notice is being issued to the project proponent (Vedanta) as to why the environmental clearance for the 1-million tonnes per annum refinery should not be cancelled,” Ramesh added.
Stressing that his ministry was not undertaking a ‘witch-hunt’, Ramesh said the Orissa government had violated the Forest Rights Act and that Vedanata Resources violated the Environment Protection Act . “We are examining what penal action should be initiated against the project proponents for the violations of various laws, including the EPA. The Orissa government officials acted to the best of their abilities,” he said.
“Any ministry’s job is not only to execute programmes, but also to enforce laws made by Parliament... The Supreme Court gave in-principle approval to the project, but my ministry can’t work on the basis of fait accompli. We have to use our mind in light of the new evidence,” the minister said.
He said his ministry had not blacklisted Vedanta, but added: “I would look upon any bauxite mining with a great degree of scrutiny and circumspection.” The mines ministry, meanwhile, tried to put the onus on the Orissa government. “The state government had made a recommendation to us in this case, following which we gave our approval, which is our job. We gave the concession to Orissa Mining Corporation. After that, it is a matter for the state government to look into. Neither is the land accord held by us, nor is the lease agreement signed with us.”
“It is extremely unfortunate that the Environment Ministry has rejected the Stage-II forest clearance for the bauxite mining project of VAL (Vedanta Aluminum Ltd). After giving the in-principle environment clearance for the project, the Environment Ministry has suddenly rejected the Stage-II clearance for the project in an improper and inappropriate manner,” Orissa industries minister Raghunath Mohanty told reporters.
| No deal to clear Posco and reject Vedanta: Jairam |
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Environment Minister Jairam Ramesh on Tuesday said there was no deal on clearing Posco’s project in Orissa, even as his ministry rejected Vedanta’s proposal for bauxite mining. “There was no deal, though I understand the strategic implications of Posco in terms of the largest foreign direct investment, Look East Policy and our relations with South Korea. There are no tribal issues in Posco while the proposition from Vedanta is different. The two cannot be equated. What I promised to do was to hasten the report submission from the committee headed by Meena Gupta by September.” |
Reacting to Orissa Chief Minister Naveen Patnaik’s statement on Monday — that Ramesh had assured him that none of the tribal villages in Orissa would be submerged because of the Polavaram dam project in Andhra Pradesh — Ramesh said: “It was an unofficial press release and the Orissa CM exaggerated it. Maybe he didn’t see the copy that said there would be no submergence. We have given conditional approval to the project and the day even an inch of Orissa is submerged, we will withdraw the clearance.”
He added that he would have done the same had such a thing happened in Andhra Pradesh. “I probably know more Oriya than him,” Ramesh added. On Vedanta University, he said the Orissa CM had asked for a speedy approval.
