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Illegal mining in India: Unabated and unchecked

30 March 2012

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(Hindustan Times, March 17, 2012)

In scarred country

by Chetan Chauhan

Illegal mining in India could be a much bigger game than the headline-grabbing 2G scam. In just two states — Goa and Karnataka, the government lost about Rs 36,000 crore — money that could feed half the country’s 400 million poor for a year — because of illegally extracted iron ore. "Annual illegal mining should be worth over Rs 1 lakh crore," says a former mining secretary, on the condition of anonymity.

In 2010, the government constituted a commission under Justice (retired) MS Shah to investigate illegal mining and found it rampant in Goa and Karnataka. "Our report will be an eye opener," Justice Shah told HT. He has accused government officials of conniving with illegal miners, recently.

There’s been a substantial increase in demand from China, accounting for 86 % of iron ore exported from India. A tonne of iron ore, which fetches $136 there, is bought for less than a dollar from the government. Other lucrative minerals include manganese, bauxite and cadmium. "For this exorbitant profit, miners extract much more than permitted," says Ramesh Gauns, who along with Claude Alvares of the Goa Foundation launched a campaign against illegal mining in the state. Former Lokayukta Justice Santosh Hedge found that iron ore excavated in Karnataka’s Bellary district was five times the permitted limit.

Blatant disregard

In both Karnataka and Goa, the complicity of local officials and politicians has been established. "A fixed bribe is paid for each illegally mined truck leaving a mine," Hedge says. Once the mineral is out of the mining area, its export is extremely easy because ports are only concerned with payment of duty, not the mineral’s source. "About 43 % of iron ore being exported from Goa was illegal," says a report of the Public Accounts Committee of Goa Assembly. Half of the ore exported from Karnataka was illegal, Hedge says. The menace is spread across India with 3.29 lakh cases of illegal mining reported between 2006 and 2011 from different states.

Illegal mining of minor minerals, for which permission is given by state governments, is higher than it is for the major minerals. It has also claimed lives of people who tried to expose the nexus between the ruling class and the mafia. As recently as March 9, IPS official Narender Kumar was crushed to death when he tried to stop a lorry carrying illegally mined stones in Morena, Madhya Pradesh. Last year, Nigamanand was alleged poisoned for undertaking a fast in Haridwar, Uttarakhand, against illegal mining of stones in the river Ganga. In 2010, RTI activist Amit Jethwa was shot dead allegedly for exposing illegal sand mining in the Gir forests of Gujarat, the country’s only haven for Asiatic lions.

Unabated and unchecked

Despite the deaths, nailing this nexus has not been easy. Meanwhile, the impact on the environment is evident. The Centre for Science and Environment reported an increase in cases of asthma near mining sites in Madhya Pradesh and Chhattisgarh. The Damodar river in Jharkhand, a repository of 46% of India’s coal, is highly contaminated with heavy metals, resulting in the average age of locals being 49 years (as compared for 65 for all of India).

Illegal mining has threatened the existence of a regenerated population of 12 tigers in the Panna reserve, which lost all tigers in 2009. Hedge says sloth bears and medicinal plants have vanished from Karnataka’s mining districts.

This week, the Supreme Court tried to take a corrective step by disallowing mining without environment clearance in any mining sites smaller than five hectares. "Every mining permission will need an environment management plan," says apex court lawyer Ritwik Dutta, a specialist in green issues.

Karnataka

Minerals: Gold, iron, manganese, clay, ochre, quartz, gemstones, copper, kaolin, limestone, magnetite.

Mafia/politics: Illegal mining was investigated by Karnataka Lokayukta Justice Hegde in 2007-2008. His report, listing forest encroachment, illegal ‘raising of contracts’, illegal transportation, involvement of officials, politicians and thousands of crores of rupees, came out in December 2008. BJP’s Gali Janardhana Reddy, one of the state’s richest politicians, is at the centre of the illegal mining controversy. He was implicated in the Bellary mining scandal and Belekeri port scam. The Reddy brothers got their first mining lease in 2004 then rose meteorically. In 2009, they spent Rs 20 crore on a wedding. Family-owned helicopters ferried over 10,000 guests to the venue. A month later, the brothers donated a Rs 42-crore diamond-studded crown to a temple. Former CMs BS Yeddyurappa, HD Kumaraswamy,and present Minister V Somanna, have also been named in Hegde’s report, which cost BSY and Reddys their ministerships.

Andhra Pradesh

Minerals: Barites, iron-ore, semi-precious stones, granites, sand

Mafia/politics: YS Raja Reddy, father of late CM YS Rajasekhara Reddy, entered the barite mining after the mineral (used in petroleum refining) was found in Kapada in the 70s. He was elected as MLA on a Congress ticket in ‘78 and became a minister in ‘80, boosting the family’s illegal mining business. GJ Reddy, currently in jail for a billion-dollar iron-ore scam in Obulapuram area of Anantapur district of AP, also cut his teeth in the barite mines of Kadapa. Smaller mafias control semi-precious stones, granites and sand in different parts of the state. Mining is tied to state politics. When the TDP govt swept to power in 1983, it tried to end the vice-like grip that the YSR family had on the state’s mining industry but failed. In 2000, the Chandrababu Naidu government cancelled the barite mining lease after an enquiry committee report. The mafia got a big boost after 2004, when YSR came back to power. He helped GJ Reddy’s Obulapuram Mining Company loot iron-ore reserves, over and above the 68.95 hectares leased to it.

Goa

Minerals: Iron, manganese, bauxite

Mafia/politics: Illegal mining began in ‘05 with China buying low-grade ore. This revived old mining concessions into leases, all operated by private firms. In the Economic Survey of 2005-06, nearly 2.7 lakh sq m of govt land was reportedly encroached on by mining companies. According to current CM , Goa’s ore exports exceeded production by 10-17% between 2007-09. Goa exports 40% of India’s iron ore. Parrikar says half the 91 iron ore mines are illegal and have caused a loss of R3,000 cr since 2005. Activists say illegal mining flourished under the Congress, especially ex-CM Digambar Kamat who held the mining portfolio for 10 years. Goa’s environment minister Aleixo Sequeira claimed in March ‘10 that 85 of 99 mine operators, including top players like Sesa Goa, Salgaocar, Chowgule and Sociedade Fomento, were continuing without mandatory clearances. While ‘09 saw a ‘mad mining race’, it was also when the forest dept was forced to survey over 40 complaints of illegal mining.

Chhattisgarh

Minerals: Iron ore, coal and bauxite, 22 varieties of other minerals, including diamonds.

Mafia/politics: Activists and locals opine that mafia activities are not visible and if existed, would be tough to establish. A controversy over bauxite mining by Balco in Kawardha district was alleged by former CM Ajit Jogi who demanded an investigation into alleged large-scale infringement of green and tribal areas. Information obtained under RTI showed the annual coal production accomplished by Prakash Industry since 2006 to be in excess of what was approved. Police arrested some people in recent years during raids at a diamond deposit site for illegally mining in Pailikhand village about 150km east of Raipur. The opposition Congress alleged that hundreds of locals in collusion with influential outsiders were illegally mining diamonds in the area. The state government deployed police forces around the site believed to have the best quality diamonds and prohibited any visit to the area without permission.

Odisha

Minerals: Iron ore, coal, bauxite, chromite, nickel and cobalt.

Mafia/politics: Illegal mining surfaced in 2009 when BJP legislators alleged irregularities in mining activities of Ram Bahadur Thakur Ltd. The vigilance department filed 16 illegal mining cases against government officials and companies like RBT Ltd, Indrani Patnaik Mines, Rungta Iron and Manganese Mines, and Serajuddin Mines. It charge-sheeted top mine owners such as Indrani Patnaik (IP) and SN Das Mohapatra and found irregularities of over Rs 2,000 crore. Congress and BJP are demanding a CBI probe into the scam, which they claim runs into over R3 lakh crore. Former SC judge Justice Shah in 2011 said the scam couldn’t have happened without the involvement of bureaucrats.

MP

Minerals: Diamond, copper, limestone, sand, manganese.

Mafia/politics: The illegal mining issue came to fore after the murder of IPS officer, Narendra Kumar Singh, by illegal miners in Chambal. A report by local authorities shows that illegal mining is going on in CM Shivraj Chauhan’s constituency. Congress plans to make it an election issue.

Rajasthan

Minerals: Marble, sandstone, rich non-metallic & industrial minerals, limestone, lignite.

Mafia/politics: No organised mafia but gangs collude with various departments, police and politicians. Complaints have been made against several Congress MLAs. "Losses to the state exchequer run into hundreds of crores," says a mining department official.

West Bengal

Minerals: Coal, apalite, asbestos, barytes, China clay, ochre, sand, graphite, mica, titanium ore.

Mafia/politics: Mining mafias silently control local economy, crime charts and the political scenario in the Asansol-Ranigunj coal belt and stone quarries in Burbhum’s Mohammad Bazaar. Mining mafioso Amit Dutta (name changed), 33, controls illegal mining with a daily revenue of Rs 1 crore. Around 500 locals work for him. Dutta, who owns four luxury cars, donates to schools, weddings and gives healthcare to poor families. In the 100-odd years of mafia rule (starting from late 1700s), now there are more illegal mines than legal run by the likes of Eastern Coalfields Ltd and Bharat Coking Coal Ltd. In 139 villages,

illegal mining is a prime economy generator and the mafias rule. Stone mafias emerged 20 years ago in Mohammad Bazaar and clashes with local tribals erupted. They get police support in grabbing land says Nilu Tudu, chief of 50 tribal villages. But, district officials checked the mafia after tribals protested and threatened the industry between February and March last year.

Tamil Nadu

Minerals: Sand, bauxite, magnetite and granite quarrying also take place.

Mafia/politics: Satish Kumar, 21, was mowed down by illegal sand miners when he tried to stop their truck from leaving his village on the banks of the Nambiyaru river. A case was registered against 10 people.
Recently, the mafia has become more violent, starting with the killing of Sudalaimuthu, an activist of the Democratic Youth Federation of India. In 2007, CPI took up the illegal sand mining issue. Till now, some eight persons have been killed, mostly CPI members. R Nallamuthu, an 85-year-old CPI veteran, successfully petitioned the Madras HC for a ban on mining in the Tamirabharani river, the only perennial river in the state. But the five-year ban continues to be flouted by illegal sand miners. The Madras High Court had earlier issued guidelines for mining and had formed a state level monitoring committee (now defunct) headed by a retired High Court judge.

Haryana

Minerals: Minor but crucial in infrastructure projects: gravel, clay, sand.

Mafia/politics: In October 2011, the Vigilance Bureau arrested two assistant mining engineers for allegedly conspiring with the local mining mafia. In 2008 it had lodged FIRs against seven people and arrested two officials. In 2009, they lodged two FIRs and arrested 15 people. Mining in Gurgaon and Faridabad is largely controlled by the Sethi Group. Other big players include Ashok Khatana and Company — an enterprise controlled by Congress MP from Faridabad Avtar Singh Bhadana and his brother, Kartar, a former Haryana Minister. A former BJP MP, Ram Chander Bainda, also dabbled in mining for years but is now inactive. In 2009 the Supreme Court and the Punjab and Haryana High court put a ban on mining operations in Haryana. The apex court said leases of minor mineral including their renewal for an area of less than 5 hectares can be granted by the states only after getting environmental clearance from the Union Ministry of Environment and Forests.

Bihar

Minerals: Sand mining, stone quarrying in hilly areas.

Mafia/politics: Over 1,000 rock mines operate illegally. Sand mining is also well organised. Over 100 mafia goons attacked the police in Feb, during a raid in protected forests. In recent years, over 50 forest officers/policemen have been injured in attacks by the forest mafia during illegal mining drives. The state govt had set up a task force in each district to stop illegal mining following complaints of stone quarrying. After the Opposition’s outrage, Nitish Kumar’s govt launched a crackdown against the mining mafia in Rohtas and Kaimur districts. The Rohtas police booked former BJP state unit president Gopal Narayan Sinha, and seized 100s of vehicles involved in illegal mining.

P.S.

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