Mining, regulatory failure and human rights in India

Published by MAC on 2012-06-19
Source: Statement, Guardian, Outlook India

Mining, regulatory failure and human rights in India

A new Human Rights Watch report calls on India's government to set up mechanisms to support the license system for mining

By Oliver Balch for the Guardian Professional Network

Guardian

14 June 2012

Voting in this week's Andhra Pradesh byelections in took place without the frontrunner in attendance. Instead of the polling booth, YSR Congress president YS Jagan Mohan Reddy found himself behind bars.

The son of a former chief minister, Reddy's personal assets allegedly include mining leases for over 181,000 acres. Earlier this week, the regional government cancelled two huge iron ore projects that had been granted to his brother-in-law.

"The scale of lawlessness that prevails in India's mining sector is hard to overstate," a report, Out of Control, published today by campaign group Human Rights Watch claims. "Even government officials acknowledge that the mining sector faces a myriad problems."

Andhra Pradesh is certainly no exception. Official statistics point to more than 82,000 cases of illegal mining across the country, all of which leave environmental destruction in their wake.

Standards in India's 2,800 registered mines are far from perfect either. In iron mining areas of Goa and Karnataka, for example, Human Rights Watch charts extensive evidence of water pollution, toxic waste and health problems resulting from metallic dust.

Disreputable companies are undoubtedly part of the problem. An ongoing campaign against FTSE 100 mining firm Vedanta, which has operations in an indigenous area of western Orissa, has served to highlight the nefarious activities of individual operators.

But companies operate in a wider context, and it is to this broader operating environment that Human Rights Watch turns its attentions.

"India has a reasonably good legal framework to address these issues ... but these laws aren't being enforced, to such an extent that they are almost meaningless," says Chris Albin-Lackey, senior research at Human Rights Watch and co-author of the report.

The licensing system provides a case in point. By law, mining companies are obliged to produce an environmental impact assessment at the project proposal stage. No mechanism exists, however, to verify the independence of these reports nor to investigate their accuracy.

"Then there's pressure to move forward these assessments with great speed because the country is trying to grow investment in this sector", says Albin-Lackey.

As India's economy shows signs of slowing, mining remains one of the bright spots on its horizon. India is the world's third largest producer of coal and the fourth largest of iron ore. Its mining industry is predicted to grow to $36.2bn by 2016.

"We're not trying to say that mining should be brought to a halt", Albin-Lackey insists.

"But the government does have a core set of obligations to regulate the industry and mitigate its impacts ... All we're asking them to do is make the systems that they've already put in place function."

The report's findings win wide support among Indian civil society groups, which have become increasingly vocal in recent years over rampant abuses in the mining sector.

All too often, the laws work against those they are supposed to protect, observes Ramesh Gopalakrishnan, a researcher at Amnesty International and author of a report on Vedanta's Indian operations.

He points to the Forest Act, for instance, which makes special provision for the protection of land traditionally occupied by indigenous groups.

"The problem is they have to file their claims before the same authorities who are alienating their lands in favour of the companies, so really they can't get any justice", he argues.

Endemic corruption is clearly a problem. This is nowhere clearer than in the mineral-rich state of Karnataka. The Human Rights Watch report describes how mining magnate Janardhana Reddy worked with government regulators to allegedly extort huge quantities of iron ore from other mine operators.

Understandably, a key recommendation of the report is for greater transparency in the permitting and licensing process. The introduction or strengthening of regional anti-corruption ombudsmen is also flagged up.

As Amnesty International's Gopalakrishnan points out, the granting of rights to sub-surface resources in India is "completely arbitrary and opaque" and often determined on a "first come, first served" basis.

The need to establish a more transparent investment policy is echoed by Leo Saldhana, coordinator of the Environment Support Group, a Karnataka-based campaign group.

"This business of our state resources belonging to the current state minister has to end ... At present, local governments have absolutely no say in what happen to the resources in their state," he says.

India's mining industry is as hamstrung by under-resourced government agencies as it is corrupt officials, the campaign group maintains. Also high on Human Rights Watch's recommendation list, therefore, is greater capacity for government agencies.

The Ministry of Mines only has a "couple of dozen" monitoring officials for the entire country, notes Albin-Lackey.

"The government hasn't allowed the regulatory institutions to grow apace [with the sector], so you have government officials who have no time to do any kind of infield assessments", he adds.

The primary problem isn't new laws. A proposed new mining bill is being debated in the Indian parliament right now. Where the system falls down is in the implementation stage.

In practical terms, this means more and better-equipped monitoring staff, Human Rights Watch insists. Likewise, it is calling for more resources to be earmarked for the review of proposed new mining projects.

It's not only NGOs that should salute such measures. Companies should too. Operating in an environment that lacks clear rules introduces extraneous costs and additional risk.

"For the fly-by-night operators, the situation is good. But an investor interested in mining over a long period needs the assurance of no illegality," states Sridhar Ramamurthi, chairperson of the local NGO coalition Mines, Minerals and People.

Appeals to the Federation of Indian Mining Industries have so far gone unheard, he laments.

That's not to say India's mining sector has been totally inactive. Jo Phelan, country director for the International Business Leaders Forum (IBLF) in India, points to an electronic auction platform for steel and coal called mJunction.

"mJunction has brought transparency to the market and helped raise standards in procurement", he argues.

Another example is provided by Siemens. The German engineering giant, which sources iron ore in India for its steel production, now insists on full transparency and compliance from all its business operations.

Working in isolation is very tough, however. Phelan points to the example of the Sustainable Mining Initiative as evidence of a collective business-led attempt to "raise the bar" in India.

Convened by London-based mining company Rio Tinto, the ten-member initiative adheres to six core principles. The list is fairly generic: integrate sustainable development into decision-making, uphold human rights, conduct business ethically, and so forth. But it's a start.

It behoves all companies operating in India's mining sector, the vast majority of which are domestically-owned, to lobby for better regulation, concludes Albin-Lackey.

"Responsible companies shouldn't just sit there passively and watch all this chaos", he argues.

"Along with other stakeholders, they should be actively encouraging the government to put more meaningful governance in place for the whole sector."

Oliver Balch is author of India Rising: Tales from a Changing Nation

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India: Mining Industry Out of Control

Breakdown of Government Oversight Harms Communities, Fuels Corruption

Human Rights Watch statement

14 June 2012

Mining operations often cause immense destruction when government doesn't exercise proper oversight. India has laws on the books to protect mining-affected communities from harm, but their enforcement has essentially collapsed. - Meenakshi Ganguly, South Asia director

Panaji - India's government has failed to enforce key human rights and environmental safeguards in the country's mining industry, Human Rights Watch said in a report released today.

The 70-page report, "Out of Control: Mining, Regulatory Failure and Human Rights in India," finds that deep-rooted shortcomings in the design and implementation of key policies have effectively left mine operators to supervise themselves.

This has fueled pervasive lawlessness in India's scandal-ridden mining industry and threatens serious harm to mining-affected communities. Human Rights Watch documented allegations that irresponsible mining operations have damaged the health, water, environment, and livelihoods of these communities.

"Mining operations often cause immense destruction when government doesn't exercise proper oversight," said Meenakshi Ganguly, South Asia director at Human Rights Watch. "India has laws on the books to protect mining-affected communities from harm, but their enforcement has essentially collapsed."

India's government has systemically failed to ensure that the country's 2,600 authorized mining operations adhere to key human rights and environmental protections under Indian law, Human Rights Watch found.

These problems are related to and have facilitated a series of high-profile corruption allegations in the mining industry that have rocked India in recent years. Illegality in the mining sector has deprived state governments of badly needed revenues, threatened the industry with costly and unpredictable shutdowns, and generated political chaos that helped bring down two state governments in 2011 and 2012.

The Human Rights Watch report is based in part on interviews with more than 80 people in Goa and Karnataka states, as well as in New Delhi, including residents in affected communities, activists, and mining company and government officials.

Farmers in Goa and Karnataka told Human Rights Watch that mining operations have destroyed or polluted vital springs and groundwater supplies. Overladen ore trucks throw off clouds of iron-rich dust as they pass through rural communities, destroying crops and potentially damaging the health of nearby families. In some cases, people who speak out about these problems have been threatened, harassed, or physically attacked, while government authorities failed to address their grievances.

These and other human rights problems in the mining industry are linked to deep-rooted government failures of oversight and regulation, Human Rights Watch said. Some key regulatory safeguards are virtually set up to fail because of poor design. But in many cases, the problem is that implementation is so shoddy that it renders relatively good laws ineffective, Human Rights Watch found.

"Mining scandals may grab headlines, but the root causes of India's mining problems are more basic," Ganguly said. "The government has encouraged lawlessness by failing to enforce the law or even monitor whether mine operators are complying with it."

Indian law, like that of many other countries, situates core human rights protections somewhat awkwardly within regulatory frameworks designed primarily to mitigate the environmental impacts of mining operations. This places much of the responsibility for monitoring and enforcement with India's Ministry of Environment and Forests.

The government has sufficient authority to correct the serious flaws in the existing regulatory framework, Human Rights Watch said. For instance, the government relies on mining companies to commission and produce the "independent" Environmental Impact Assessments that are used to gauge a proposed mining project's likely environmental, social, and human rights impacts.

This creates an unnecessary conflict of interest that could be solved by giving regulators the central role in commissioning those studies. The assessments also tend to give short shrift to human rights issues, focusing overwhelmingly on purely environmental concerns.

Enforcement is an even bigger problem, Human Rights Watch found. Regulatory institutions are hopelessly overstretched. A few dozen central government officials are tasked with overseeing the environmental and human rights impacts of every mine in India - and many other industries as well. This makes in-field monitoring a practical impossibility, forcing the government to rely almost exclusively on information provided by mine operators themselves.

Many state government oversight bodies have even less capacity to implement their challenging mandates. As a result, government regulators have no idea how many mining firms are complying with the law or how many communities have been harmed by illegal practices.

Similar problems pervade the process for approving new mining operations. Regulators often rely exclusively on the Environmental Impact Assessments commissioned by mining firms to determine whether to allow a project to go forward. Field visits are rare and projects are considered and approved at such a rapid pace that there is no time for serious scrutiny of the conclusions of the environmental impact reports.

Yet the evidence shows that those reports are often rife with incorrect or deliberately misleading information. Under this framework, approval for new mining and other industrial projects is almost never denied. Many currently operational mines may have been given approval to proceed on the basis of false information about potential harm to neighboring communities.

The central government has taken some tentative steps toward improving oversight - like requiring companies to choose from a list of accredited firms to carry out Environmental Impact Assessments. But the reforms have not gone nearly far enough. Human Rights Watch urged the government to adopt a number of pragmatic policy recommendations to narrow some of the most important regulatory gaps.

"Mining is an important part of India's economy, but that does not mean the industry should be allowed to write its own rules," Ganguly said. "The government can and should empower regulators to do their jobs more effectively than they can today."

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The Death Of A Waterfall

The mining scourge reaches the sacred Khandadhara. Will it turn ‘raktadhara'?

Madhusree Mukerjee

Outlook (India)

11 June 2012

A rugged, tree-covered mountain range sweeps vertically into a brilliant blue sky. Out of a cave on its western side gushes a natural spring, its lacy, white water tripping 244 metres over a sheer black-and-red cliff face to fall into a blissful rock pool, before cascading further downhill. The site is of ethereal beauty, evoking awe, elation, a sense of rejuvenation.

One of India's highest and most sacred waterfalls, Khandadhara in Sundergarh, Orissa, is cherished by tens of thousands for the life it brings to all in its vicinity. "It's because of the Khandadhara that my life flows with power," says a Munda resident of Bandhbarna village, which lies near the foot of the mountain. Although a migrant from Jharkhand, he shares the reverence of all the indigenous peoples here-including the Christians-for the Khandadhar mountain and its waterfall.

By common consent, the guardians of the range are the Pauri Bhuiya, a tribe of shifting cultivators who traditionally live in the dense sal forest that covers the peaks. Genetic research finds that about 24,000 years ago the Pauri Bhuiya shared a common ancestor with the Jarawa of the Andaman Islands-a reminder that India's indigenous peoples directly descend from some of the first modern humans to wander the earth. The Pauri Bhuiya are also unique among Orissa's tribals for speaking a version of Oriya, rather than an entirely different language: they claim theirs is the original Oriya.

A Pauri Bhuiya legend speaks of how their mountains came to be so munificent. The Sundergarh branch of the community was once possessed by a rapacious goddess named Kankala Devi, who consumed trees, soil and everything else. In despair, the Pauri Bhuiya placed her on a rock, which she ate through as well-creating a deep hole from which poured out the Khandadhara (split-rock waterfall). So they had water.

Then a couple from the community went to visit relatives at the eastern, or Keonjhar, end of the Khandadhar mountain range. Their prospective hosts were away but a pile of grains had been left outdoors and, amazingly, not even the birds were eating it. Inside the heap, the couple discovered a small goddess, Khand Kumari, protector of the region's prosperity. They stole her and brought her back to Sundergarh, and so her bounty became theirs.

The Pauri Bhuiya never cut down a shade or fruit tree, so the mountaintop abounds with nourishment. The pristine, ancient jungles are home to elephants, sloth bears, leopards, gaur, pythons, peacocks, tigers and a rare limbless lizard-a keystone species that testifies to the richness of the ecosystem.

The thick jungle absorbs monsoon rain, releasing the water in perennial streams that feed the Khandadhara. But in the '90s, some 80 Pauri Bhuiya families were shifted by the Pauri Bhuiya Development Agency (PBDA) from the mountaintop to the plains, under the pretext that their shifting cultivation was damaging the forest.

"Here we have nothing," laments Kalia Dehuri, who now lives in a PBDA settlement. "Our houses are as small as latrines. They promised us five acres of land each but gave us just a little over one acre. When we lived in the forest, if I cut my leg I could find a plant to heal it. Now I have to walk miles in the sun to the doctor, who tells me to come back another day." The despair and hopelessness is palpable. Of the families brought down, at least 15 have since returned to the mountain. "There it is cool," says Dehuri, "and they have fruit, water, wood, tubers."

Not for long. The strikingly coloured rocks that give Khandadhara its beauty are red jasper and black hematite-both made of iron. Downstream of Khandadhara, one can pick up massive, gleaming chunks of largely pure iron.

The mining companies call the Khandadhar range the "jackpot", and at this very moment the Supreme Court is deciding which of several contending firms has the winning ticket. The Orissa government has promised the Pohang Steel Co of South Korea (Posco) as much as 2,500 hectares of Khandadhar-essentially the entire Sundergarh section of the mountain range.

All the region's tribals know what will happen if Posco comes, because they have had a foretaste. Deep inside the range, invisible from normal roads, rises a horrific sight: the blood-red carcass of Kurmitar mountain, flayed of its skin of trees and topsoil and terraced into a giant pyramid by a spiralling road for trucks laden with iron ore. Dynamite blasts have pulverised the underlying rock into a fine dust that gives the mine its brilliant red colour.

Behind this Mars-scape, the partially shaved surface of another mountain rises-readied for mining by clear-cutting the trees. Dust smothers the jungle for hundreds of metres around, but in the distance one can see the undulating green of what remains, for now, of the Khandadhar reserved forest.

The Kalinga Commercial Corporation Ltd (KCCL) operates the 133-hectare Kurmitar mine. It boasts on its website of having exceeded production targets by several hundred per cent, and of exporting iron ore to China and manganese ore to an unnamed Korean company. Hanuman is said to have carried on his shoulders a portion of the Himalayas in order to find a medicinal plant to save Lakshman's life. The Samal family of Bhubaneswar, which runs KCC, could be even more powerful: it is transporting an entire mountain to China and beyond.

Kurmitar was a "devisthan", the abode of a goddess, say the Pauri Bhuiya. It was covered with dense jungle in which thrived elephants, bears and luscious kakri fruit hanging from vines. No doubt driven out by the blasting and loss of habitat, the elephants have begun emerging in the plains. A tigress appeared in January near Phuljhar, at the foot of the mountain. In April, the forest department burned down the huts and food stores of some 20 Pauri Bhuiya families who had come off the mountain and were sheltering in jungles that had been their own.

Just as frightening, the destruction of the forest and the diversion of a mountaintop stream by KCCL has caused the Khandadhara waterfall to partially dry up. Its water no longer reaches the Brahmani river as it used to, and a canal that Bandhbarna's residents used for fishing, bathing and irrigating crops has been bone-dry for two summers now.

All over the region, tubewells are becoming defunct as the water table falls. Streams by Phuljhar and other villages run red with mining dirt, killing fish and polluting fields. When it rains, even the Khandadhara bleeds red, transforming into a ‘raktadhara' that flows from the mountain's gaping wounds. If a 133-hectare mine can cause such havoc, the devastation to be wreaked by Posco's 2,500-hectare lease is beyond imagination.

To begin with, the Khandadhara waterfall will completely dry up, depriving tens of thousands of the water of life. "The miners are demons...they not only eat the soil and trees and rock, but even the water," says a Pauri Bhuiya woman in Phuljhar. "Kankala Devi gave us this water, these demons will consume it too. We have to get rid of them or they will eat up everything."

All around the Khandadhar range, the tribals are gearing up for a fight - not only for their own survival, but in defense of a common heritage of humankind.