Vedanta- Niyamgiri Mining issue

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Vedanta- Niyamgiri Mining issue

  1. 1. The “VEDANTA ISSUE”
  2. 2. What Is Vedanta??        Vedanta Resources is a London Stock Exchange listed, globally diversified natural resources major with interests in Zinc, Lead, Silver, Copper, Iron Ore, Aluminium, Power and Oil & Gas. The company was founded by Anil Agarwal in Mumbai in 1976. It is the largest mining and non-ferrous metals company in India and also has mining operations in Australia and Zambia. It was first listed on the London Stock Exchange in 2003 when it raised $876 million through an Initial Public Offering. In 2006 it acquired Sterlite Gold, a gold mining business. In 2008 it bought certain of the assets of Asarco, a copper mining business. In December 2011 it announced the US$8.67 billion acquisition of Cairn India a subsidiary of Cairn Energy, heralding its foray in the oil sector. It is also developing commercial power stations in India in Orissa (2,400 MW) and Punjab(1,980 MW).
  3. 3. Operations in India     Sterlite Industries (India) Ltd.: Sterlite is registered office headquartered in Tuticorin, India. Vedanta owns 53.9% of Sterlite and has management control of the company. Hindustan Zinc Limited: HZL is headquartered in Udaipur in the state of Rajasthan. HZL‟s equity shares are listed and traded on the NSE and BSE. Sterlite owns 64.9% of the share capital in HZL and has management control. Sterlite has a call option to acquire the government of India‟s remaining ownership interest. Bharat Aluminium Company Ltd.: BALCO is headquartered at Korba in the state of Chhattisgarh. Sterlite owns 51.0% of the share capital of BALCO and has management control of the company. The government of India owns the remaining 49.0%. Sterlite exercised an option to acquire the government of India‟s remaining ownership interest in BALCO in March 2004. Madras Aluminium Company Ltd.: MALCO is headquartered in Mettur, India. MALCO‟s equity shares are listed and traded on the NSE and BSE. It owns 93.9% of MALCO‟s share capital and has management control of the company.
  4. 4.    Vedanta Aluminium Ltd.: Vedanta Aluminium is headquartered in Jharsuguda, state of Orissa. Vedanta owns 70.5% of the share capital of Vedanta Aluminium and Sterlite owns the remaining 29.5% share capital of Vedanta Aluminium. Vedanta Aluminium produces ingots, billets & wire rods that are sold in the markets around the world. Vedanta Aluminium Limited (VAL) has acquired 24.5% stake in L & T subsidiary Raykal Aluminium. Based on achieving certain milestones, VAL will fully acquire Raykal Aluminium in phases.  Sesa GoaLimited: Sesa Goa is headquartered in Panaji, India, and its equity shares are listed and traded on the NSE and BSE. Vedanta owns 57.1% of Sesa and has management control of the company.  Sterlite Energy Limited: Sterlite Energy is headquartered in Mumbai. Sterlite owns 100.0% of Sterlite Energy and has management control of the company.
  5. 5. Environment & Vedanta     Vedanta has been criticised by human rights and activist groups, including Survival International, Amnesty Internationa and Niyamgiri Surakshya Samiti because of the company's operations in Niyamgiri Hills in Orissa, India that are said to threaten the lives of the Dongria Kondh people who populate this region. Vedanta's Alumina Refinery in Lanjigarh was criticised by the Orissa State Pollution Control Board (the statutory environmental regulation body) for air pollution and water pollution in the area. According to Amnesty International, local people reported dust from the plant settling on clothes, crops and food. A chimney under construction by Gannon Dunkerley & Company at the Balco smelter in Korba, Chhattisgarh collapsed on 23 September 2009, killing at least 40 workers. In July 2010, Sterlite Industries, a subsidiary of Vedanta Group, was slapped a tax notice of about 3.24 billion (US$52 million), and charged with violating several rules by the excise department in India.
  6. 6. Vedanta in Niyamgiri,Orissa        The Niyamgiri Hills form a mountain range in the Eastern Indian state of Orissa. They are home to more than 8,000 of the Dongria Kondh people, whose lifestyle and religion have helped nurture the area‟s dense forests and unusually rich wildlife. Vedanta Resources wanted to mine the bauxite from the top of the same mountain. The Dongria Kondh would lose their livelihood, their identity and the sanctity of their most religious site. In common with other displaced tribal peoples worldwide, they would also lose their present good health, their self-sufficiency and their expert knowledge of the hills, forests and farming systems that they have nurtured. At the centre of the struggle was the Dongria‟s sacred mountain, the „mountain of law‟. The Dongrias worship the top of the mountain as the seat of their god and protect the forests there. The Dongria Kondh have successfully fought off Vedanta Resources, a company that was determined to mine their sacred mountain‟s rich seam of bauxite (aluminium ore).
  7. 7. Vedanta Proposal     Niyamgiri hills belong to the Eastern Ghats, and in-situ reserves of metallurgical grade bauxite have been reported from this area. This was of importance during the recent years when the demand of aluminium in the international market jumped substantially, and aluminum-giants needed more reserves of bauxite to increase their production to take advantage of boom market conditions. The main consideration of international finance capital was to maximize profit in areas, which are highly rewarding and require almost no pre-requisites for investment. Vedanta Alumina Limited, a subsidiary of M/S Sterlite Industries (India) Limited is going to mine bauxite deposit from the Niyamgiri hills jointly with Orissa Mining Corporation Limited (OMC) as per the lease agreement signed in between VAL (Vedanta Alumina Ltd.) and Orissa Mining Corporation (OMC) in October 2004.
  8. 8.       According to the MoU signed by SIIL and Govt.of Orissa on 7th June 2003, SIIL would set up an Alumina Complex, which includes 1.0 MTPA Alumina Refinery Plant, 3.0 MTPA of bauxite mining and 75 MW Captive Power Plant at Lanjigarh in the disrict of Kalahandi at an aggregate investment of approximately Rs.4000/- crore. The REIA (Rapid Environmental Impact Assessment) report prepared by Tata AIG Risk Management Services Ltd., Mumbai (TARMS) for SIIL mentions that the estimated bauxite reserve in the lease area is about 73 million tons and the estimated life span of the mining is 23 years. The proposed mining site is located on the top of Niyamgiri hills. As per the REIA, “Mechanized open cast mining is proposed for the deposit particularly due to low overburden thickness, high bauxite thickness and high production levels. The blasted material will be loaded by hydraulic excavations and subsequently transported by 35 tonner dumper to semi mobile Crusher Hopper. The crushed bauxite ore will then be sent to the Alumina refinery by conveyors.
  9. 9. IMPACT OF MINING BAUXITE ON NIYAMGIRI Among the major environmental impacts of bauxite mining are the implications of the disposal of alkaline mud otherwise known as 'red mud'.  Escape of caustic soda, used toextract alumina from raw bauxite, into the ground water is quite likely which will increase sodium concentration in the well water, etc., and high sodium is undesirable in potable water since it is associated with hypertension.  Mining in Niyamgiri hills, which is one of the most ecologically biodiverse areas of the state with its wide range of flora and fauna, rivers and streams defies logic and reasoning.  It becomes even inhuman and anti-conservation when one sees gross undervaluation of the close interaction between the local tribes especially the primitive tribe „Dongaria Kondha‟ with the nature and other forms of life in Niyamgiri. 
  10. 10.     It clearly mentioned in the REIA report under title heading „Land Environment‟ in No. 11, that the proposed project will result in change in land use pattern. There will be reduction in the forest cover (mainly reserve forest cover). Similarly, an article published in „The Hindu Business line‟ on August 2004, it says that “a rich resource would be lost forever if the mines become operational.“ Not only will the project spell doom for these tribes and the ones whose lands fall under the alumina plant area, it would also devastate the local ecology-springs, rivers, and many endangered species. The people of south Orissa will lose their permanent source of water from Vamsadhara and Nagavalli, which irrigate their fields and meeting their drinking water, needs.
  11. 11. Protests……& How Vedanta Lost “A decade-long stand-off between Vedanta and the villagers of  Odisha’s Niyamgiri hills has culminated in an outright rejection of then company’s plans to mine bauxite to feed its alumina refinery at Lanjigarh on August ,2013.”    Asked by the Supreme Court to take a call on the proposed mining, all 12 gram sabhas have asserted their community rights over Niyamgiri and said no to the state government‟s move to hand over nearly 700 hectare of forest land to VAL (Vedanta Aluminium Ltd) for harvesting bauxite. In April 2009, the Ministry of Environment and Forests (MoEF) had cleared the mining project. Amid widespread protests, the Centre constituted a committee under NC Saxena that pointed out a number of irregularities. Subsequently, acting on the fresh recommendation of the Forest Advisory Committee (FAC) that had in 2007 approved the project, then Environment minister Jairam Ramesh ordered temporary withdrawal of clearance in August 2010.
  12. 12.        In March 2011, the Odisha government moved the Supreme Court against the MoEF‟s order. Once the ministry defended its stand as asafeguard against possible violation of cultural and religious rights of the local tribals, the SC on 18 April,2013 asked the state to seek the view of affected villagers. Acting on the state government‟s assurance of handing over a bauxite reserve lying within a stone‟s throw, Vedanta has already invested Rs 50,000 crore in the project in building the refinery at Lanjigarh. It was considered one of Chief Minister Naveen Patnaik‟s early breakthroughs when he apparently convinced Anil Agarwal to invest in the backward districts of Kalahandi and Rayagada. The company sought environment (2003) and forest (2004) clearances for its plant separately. The application for the environment clearance made no mention of the forest land required. The environment clearance was issued in 2004 on condition that the company would secure mining clearance before “operationalising” the refinery. The approval letter stated that “the project does not involve diversion of forest land.”
  13. 13.         The MoEF issued a stop-work notice in 2005 till clearance was given for the diversion of 58.9 hectare of forestland. The company promptly withdrew its application for forest clearance, saying it didn‟t need the forest land. Following a strong recommendation by the Central Empowered Committee against mining, the SC in 2006 , asked the Wildlife Institute of India (WII) and Central Mine Planning and Design Institute Limited (CMPDIL) to examine the project‟s impact on wildlife, soil and water systems. While CMPDIL gave the project a clean chit in 2007, the WII report expressed a number of concerns over the impact of mining on the wildlife before settling for a Rs 42-crore mitigation plan. But for now, the company will have to depend on bauxite from faraway Gujarat to keep its Lanjigarh refinery in operation. Thanks to the Supreme Court, the people‟s courts at Niyamgiri have set a benchmark for the implementation of the Forest Rights Act. The SC‟s other verdict, giving landowners proprietary rights to minerals lying under their land, has redrawn the limits of state ownership. Now it is for our elected leaders to honour the people’s trust and commit and deliver within the confines of a democracy.
  14. 14. Thank you All !!!

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