Modi Govt’s Coal Mining Expansion Spree Keeps Local Communities Away from Decision-making

News Click || Ayaskant Das || June 26, 2022

In the recent past, project proponents have been falling back on a 2017 rule to expand existing coal mines incrementally without consulting local communities.

New Delhi: In a worrying trend that is indicative of the Modi government’s indifference towards local communities affected by industrial development, no public hearings were conducted for as many as six out of the nine coal mining projects that were provided environment clearances for expansion in the first half of 2022. The combined expanded capacity of the six projects is 200% higher than that of the three projects for which public hearings were conducted.

The six projects which were cleared without public hearings account for a capacity addition of 10.70 million tons per annum (MTPA) to the country’s coal mining sector, shows an analysis of data contained on the website of the Union Ministry of Environment, Forests & Climate Change (MoEF&CC). On the other hand, the total expansion in capacity of coal mining projects for which public hearings were conducted is 5.35 MTPA.

“The very concept of awarding prior Environmental Clearances without conducting public hearings is dubious enough even though it is done by properly following rules. The rules followed to procure clearances in this manner do not take into account special provisions available to local communities in areas which, owing to the preponderance of tribal population in them, have been identified as Schedule 5 under the Constitution of India,” said Rebbapragada Ravi of mines, minerals and PEOPLE (mm&P), an alliance of individuals and communities affected by mining.

Coal-mining industries are bypassing the process of public hearings by resorting to a rule introduced by the Modi government in September 2017. The rule – introduced through the MoEF&CC in the form of an office memorandum – allows for an incremental increase in the capacity of coal mining projects, up to a maximum limit of 40%, without necessarily having to conduct public hearings.

In the first six months of 2022, the MoEF&CC provided Environmental Clearance to seven new coal mining projects with a combined capacity of 55.81 MTPA. The Siarmal Opencast Coal Mining Project in Sundergarh district of Odisha – undertaken by the public sector Mahanadi Coalfields Limited – accounts for whopping capacity addition of 50 MTPA. If this large project is discounted from the list of new coal blocks that have been provided environmental clearance for mining, the proportion of capacity addition in terms of expanding existing projects is nearly double that of new projects. Total capacity addition to the country’s coal sector in terms of expansion of existing mines has already touched the figure of 11.35 MTPA so far this year.

As per a study released recently by the New Delhi-headquartered Legal Initiative for Forests & Environment (LIFE), in the past three years spanning the period between 2019 and 2022 at least 18 coal mining expansion projects were cleared without public participation. These include six projects in 2019, five projects in 2020 and seven projects in 2021. These 18 projects accounted for total capacity addition of 39.834 MTPA to the coal sector during 2019-21.

“This issue is of great concern as during 2021, almost 50% of Capacity increase of Expansion projects coming for EC under the provision of clause 7(ii) of EIA Notification, 2006, has been granted EC without any sort of public participation,” states the LIFE report.

The report further highlights that between the years 2019 and 2021, the MoEF&CC provided Environmental Clearances to as many as 38 coal mining projects. These include 11 projects (five new, six expansion) in the year 2019 while 12 projects (three new, nine expansion) were provided Environmental Clearances in 2020. In the year 2021, the ministry provided Environmental Clearances to 16 coal mining projects (four new, 12 expansion).

However, by the first half of 2022, the ministry has already provided 16 Environmental Clearances out of which seven are for new projects while nine are for expansion of already existing projects. Given the pace at which coal blocks are being opened up for mining in gross disregard for climate change and the negative environmental impacts thereof, a section of experts has already begun arguing for totally moving away from fossil-fuel-based energy sources.

“Any new investment in coal mining is not only destroying our biodiversity, ecosystems, forests and livelihoods of forest dwellers but is also adding to stranded assets in the sector in a manner akin to that which has happened in the power generation sector over the past two decades. We already have enough coal mining capacity which is either operational, under development or has already been granted Environmental Clearances. Future growth in energy demand will and should be fulfilled by renewable energy sources. There is no need for giving new clearances to ecologically destructive projects like coal mining,” said Sunil Dahiya of the independent research organization Centre for Research on Energy and Clean Air.

However, coal-based energy sources continue to account for nearly 50.7% of the total installed power generation capacity of the country while the capacity of installed renewable energy sources lags behind at less than 40%. In times of extraordinary increase in demand for electricity consumption, like the one witnessed between March and June this year when prices of imported coal simultaneously sky-rocketed, the government had to naturally fall back on increasing production and transportation of domestic coal. Environmental Clearances for all new seven new coal mining projects were also provided during this period, that is, between March and June.

Nevertheless, barring local communities from having their say vis-à-vis large coal mining projects is a practice that has been followed by governments cutting across party lines and ideologies. The practice, apparently perceived as beneficial for the corporate sector, was put in place by the Congress-led United Progressive Alliance (UPA) government in December 2012 when, the Union Ministry of Environment & Forests, as it was called under the UPA government, exempted public hearings for coal mining projects seeking to expand 25% of the production capacity. This policy which was also issued through an Office Memorandum permitted only a “one-time expansion” with a ceiling of 2 MTPA if the extracted coal was to be transported by road and a ceiling of 5 MTPA if it was to be transported by the railway network. Just ahead of the general elections of 2014, the UPA government extended the provision of exemption from the public hearings for one-time expansion of coal mines with a capacity of up to 8 MTPA to 50% or 1 MTPA, whichever was higher. The extension was provided through an Office Memorandum that was issued in January 2014 by the environment ministry.

After BJP-led National Democratic Alliance (NDA) was elected to power, the MoEF&CC issued another Office Memorandum on May 30, 2014, extending the provisions of the notification issued in January 2014 to those coal mines as well that had already expanded their production capacity as a one-time measure following the notification of December 2012. The NDA government issued another office memorandum in July 2014 empowering the MoEF&CC’s Expert Appraisal Committee, a panel that conducts appraisals of industries likely to impact the environment, to decide on exempting those coal mining projects, where the capacity exceeded 16 MTPA, from public hearings to a ceiling of up to 5 MTPA. This was applicable in cases where extracted minerals were not to be transported by road.

The practice of easing procurement of Environmental Clearances for mining activities by issuing amendments to the Environment Impact Assessment (EIA) Notification, 2006 through mere Office Memoranda was flagged by the National Green Tribunal while delivering its verdict in a case in September 2015.

“ … the [EIA] Notification mandates the requirement of “prior Environmental Clearance” without exception. However the entire mandate of prior Environmental Clearance has not only been diluted but completely rendered infructuous or ineffective by issuance of these impugned Office Memoranda. Therefore, the Office Memoranda stated to “guidelines”, are potently destructive of the Notification of 2006,” the tribunal had stated in the judgement issued on 7 July 2015.

Nevertheless, since the issuing of this judgement, the Modi government has not limited exemptions for public hearings to the coal mining sector alone. The exemption has been extended to the mining of other minerals including iron, manganese, bauxite and limestone. On 20 October 2021, the Modi government exempted five-star rated mining firms extracting iron, manganese, bauxite and limestone from public hearings while expanding production capacity by as much as 20 per cent. This exemption, which was again issued through an Office Memorandum, holds “written submissions” from affected communities and individuals as measures adequate enough in so far as public consultations are concerned.

Name of the ProjectLocationProject ProponentCapacity of New Projects granted EC (MTPA)Capacity Increase of Projects granted EC for Expansion (MTPA)Capacity increase of Projects granted Expansion under Sep 2017 OM (MTPA)
Kathara Opencast Coal MineBlock Bermo, District Bokaro (Jharkhand)Central Coalfields Limited1.9  
Bharkunda OCPTehsil Patratu, District Ramgarh (Jharkhand)Central Coalfields Limited2.05  
Jamadoba Underground Coal MineTehsil Jharia, District Dhanbad (Jharkhand)Tata Steel Limited0.34  
Brahampuri Coal Mine ProjectTehsil Parasia, District Chhindwara (Madhya Pradesh)Birla Corporation Limited0.36  
Chhal Opencast coal miningTehsil Dharamjaigarh, District Raigarh (Chhattisgarh)South Eastern Coalfields Limited 2.5 
Bikram Opencast cum Underground Coal MineTehsil Burhar, District Shahdol (Madhya Pradesh)Birla Corporation Limited0.36  
Vakilpalli Mine (VKP) Underground Coal Mining ProjectMandal Kamanpur, District Peddapalli (Telangana)Singareni Collieries Company Limited0.35  
Siarmal Opencast coal mining projectDistrict Sundargarh (Odisha)Mahanadi Coalfields Limited50  
Jawahar Khani– 5Mandal Yellandu, District Bhadradri Kothagudem (Telangana)Singareni Collieries Company Limited (SCCL) 1 
Makardhokra- I OC mine (Phase-I)Tehsil Umrer, District Nagpur (Maharashtra)Western Coalfields Limited  1.4
Amadand Opencast Coal MineTehsil Kotma, Annuppur (Madhya Pradesh)South Eastern Coalfield Limited 1.85 
Garjanbahal OC mineTehsil Hemgir, District Sundargarh (Odisha)Mahanadi Coalfields Limited  2.6
Kulda Opencast Coal Mine ProjectTehsil: Hemgir, District Sundargarh (Odisha)Mahanadi Coalfields Limited  2.8
Manuguru Opencast coal mining ProjectManuguru Mandal, Bhadradi Kothgudem District, TelanganaSingareni Collieries Company Limited  0.30
Parsa East and Kanta Basan (PEKB) Opencast Coal MineTehsil Ambikapur, District Sarguja (Chhattisgarh)Rajasthan Rajya Vidyut Utpadan Nigam Ltd  3
North Urimari OCPTehsil Barkagaon, District Hazaribagh (Jharkhand)Central Coalfield Limited  0.60
   55.815.3510.7

Odisha: SAIL mining expansion public hearing concludes amid pollution fears

The New Indian Express | June 24, 2022
The public hearing was organised by the Odisha State Pollution Control Board (OSPCB) and Sundargarh administration at Ispat high school playground in Koida’s Tensa village.

ROURKELA: The public hearing for environmental clearance against mining expansion proposal of the Steel Authority of India Ltd (SAIL) concluded in Sundargarh’s Koida block on Wednesday amid opposition by an environmental group over soil and river water pollution fears.

The public hearing was organised by the Odisha State Pollution Control Board (OSPCB) and Sundargarh administration at Ispat high school playground in Koida’s Tensa village. The meet, which lasted around five hours, was presided over by Sundargarh ADM RN Sahu. Of the at least 57 representations received during the hearing, most supported the expansion proposal.

However on Tuesday, Lokshakti Abhiyan president and environment activist Prafulla Samantara sent an objection letter to the OSPCB member secretary over the public hearing. Samantara alleged that the environmental impact assessment (EIA) report on mining of 750 million tonne of iron ore over 40 years in Barsuan, Taldihi and Kalta mines of SAIL in Koida was not properly and scientifically prepared. He claimed that the report lacked data and studies on pollution and loss of green cover besides impact on human health, local fauna and flora and the rich bodiversity of nearby Khandadhar waterfall.

As per the report, water will be consumed from Kuradih Nullah and Najkura Nullah which would result in depletion of water level of Karo river and ultimately Brahmani river, Samantara alleged and claimed that no gram sabha approval was taken for diversion of huge forest area in violation of the PESA Act while provisions of the Forest Rights Act were also flouted.

Sources said during the public hearing, a supporter of PESA movement in the tribal-dominated district entered the venue and claimed violation of PESA Act in the proposed expansion. SAIL has proposed expansion of iron ore production from 8.05 million tonne per annum (MTPA) to 16 MTPA along with handling of topsoil/overburden/inter-burden of 3.92 MTPA and sub-grade dumps/tailings of 2 MTPA requiring total excavation of 22 MTPA.

Further, SAIL proposes to install dry processing plants of 7 MTPA and 4 MTPA for Taldihi and Kalta iron mines respectively, expansion of the existing 3.5 MTPA beneficiation plant to 4 MTPA along with adequate loading and siding infrastructure in the amalgamated mine lease area of 2,558.85 hectare (ha) of the 2,564.323 ha at Tantra and Bahamba villages besides Toda reserve forest. SAIL sources claimed that forest clearance for 2,419.871 ha and 138.710 ha of non-forest area of its 2,564.323 ha mining lease area has already been obtained.

Complete projects within limited time framework: DC

The Pioneer | June 08, 2022

A review meeting was conducted at the district level of District Mineral Foundation Trust (DMFT) under the chairmanship of deputy commissioner Nancy Sahay. In the meeting the deputy commissioner has instructed all departments to prepare the plan according to the demand of the public.

She instructed all the block level and district level officers to complete every plan within the time framework, which is prescribed by the state Government. This is the basic duty of the concerned department to take the administrative sanction for the further action.

She further said that the departments must prepare the plan on health, education, drinking water and social welfare with the consultation of the

concerned block and panchayat and must be passed by the villagers general meeting.

Sahay said that the plan should be implemented after 15 days in each and every block. Those blocks which are affected by the mining must be put on top priority. She has instructed the engineers of every department they must be honest in the completion of the projects. If any negative report will come to headquarters then strict action will be taken on the concerned engineer.

She told the child development officers to select 200 Anganwadi Kendra and their diet chart as early as possible and send it to the district headquarter.

In the meeting civil surgeon, district panchayat raj officer, executive officer of district board, rural development building division engineers were present.

What a Scathing Audit on Mining in Jharkhand Tells Us About CAG’s Toothlessness

The Wire | May 25, 2022
A performance audit brings home the point of what happens when the national auditor is denied access to information and records.
A recently concluded performance audit on the functioning of District Mineral Foundation (DMF) Trusts in Jharkhand has indicted the state’s Mining and Geology Department for failing to furnish the actual figures of collections from mining leaseholders.

Bringing the sad state of affairs to public notice, the national auditor said, “There were three sets of un-reconciled collection figures: one reported by Director of Mines, one as per DMFT bank accounts and one by District Mining Officers (DMOs)”.

This performance audit presents all that has gone wrong with the implementation of this fund meant for the welfare of mining-affected communities in the country.

As per the figures available on the DMF dashboard, as on March 31, 2022, cumulative contribution to DMF stood at Rs 61,867.92 crores, out of which the cumulative expenditure as on March 31, 2022 was Rs 31,212.49 crore.

Jharkhand accounts for the third largest DMF collection, amounting to Rs 8,301.37 crore as on March 31 2022. Two other mineral rich states, Odisha and Chhattisgarh received the highest DMF contribution amounting to Rs 17,907.32 crores and Rs 8,943.47 crores respectively.

While the DMF Rules notified by Jharkhand government in 2016, as well as Pradhan Mantri Khanij Kshetra Kalyan Yojana Guidelines (issued by Union Ministry of Mines) dated September 16, 2015, envisioned preparation of annual action plans and budgets for respective DMFTs, the performance audit revealed, “The District Collectors of none of the sampled DMFTs prepared annual budget or annual action plan”.

Further, in a shocking revelation, the performance audit noted that the DCs of Bokaro, Dhanbad and Ranchi incurred an expenditure of Rs 1,568.04 crore from DMFT funds on various schemes during 2016-21, without identifying the areas affected directly and indirectly by mining and generating the list of affected people by involving the Gram Sabhas of the concerned affected villages.

A mammoth Rs 4,473.18 crore (81% of total DMF collection as on March 31, 2021) in Jharkhand was sanctioned on just two areas: piped drinking water schemes and ‘open-defecation free’ activities.

When CAG auditors raised a red flag on this, bureaucracy at different level mentioned that it was so “reportedly on the instructions of Chief Minister and Chief Secretary of the state to meet scheme targets.”
A paper tiger

Beyond all these details showing us how a fund meant for local area development with participation from mining-affected communities got reduced to a line departments-driven fund, lies another lesson. Reading this performance audit brings home the point of what happens when a national auditor is denied access to information and records.

The question of whether there is a need to amend the Comptroller and Auditor General of India (Duties, Powers and Conditions of Services) Act, 1971, to grant more enforcement powers to the national auditor has become an aimless cry in the wilderness. Indian auditors who passionately love to perform their constitutionally ordained duty today wonder what to make of the letter ‘P’ in the law that is popularly known by its abbreviation: CAG (DPC) Act, 1971.

While this question was discussed at biannual Accountants General Conference in October 2008, and an amendment draft was prepared in 2009, consecutive finance ministers and ruling governments have largely ignored the matter.
In a final draft of the Jharkhand mining performance audit, the Principal Accountant General, Indu Aggarwal stated:

“Audit was denied access from examining and reporting on the functioning of State Level Monitoring Committee, which is the apex body to monitor the (District Mineral Foundation Trust) Fund at state level though the matter was reported to the Secretary of the Department and escalated to the Chief Secretary of the State Government.” [emphasis added]

At another place in the performance audit, the PAG noted:

“Thus, restrictions on access to crucial and primary records to audit despite assurance of full cooperation by the Secretary of the Department in entry conference, especially when all the audit procedures and criteria for conducting audit were explained in the entry conference (held during initiation of the performance audit, wherein PAG office briefs the representatives of the audited department about the scope and methodology of audit) and Chief Secretary of the state government was taken on board with requests to produce records is a Red Flag to presumptive fraud and misappropriation. These potentially derail the constitutional mandate of audit and prevent it from providing insights to the State Legislature for fixing accountability on erring officials”. [emphasis added]

Reading the above quotes from the final draft of the performance audit of DMF in Jharkhand reminded me of the concern expressed by P.K. Kataria and Subir Mallick in a theme paper, ‘Auditing for Good Governance: Oversight and Insight’.

Arguing for the need to grant the CAG of India wider powers on access to information and records kept by public offices, Kataria and Mallick stated:

“While section 18 of the CAG (DPC) Act, 1971, provides access to the records and accounts and empowers Audit to inspect any offices of accounts under the state or central government, it doesn’t provide any enforcement powers to the CAG of India to ensure compliance by the auditee to her/his request for information within a reasonable time.”

CAG of India had initiated the performance audit on District Mineral Foundation Trusts in Jharkhand with an entry conference in December 2020 with the Secretary of the Department of Mines and Geology. The performance audit was carried out between December 2020 and April 2022 (roughly 17 months) and the audit team picked up just six districts (Bokaro, Chatra, Dhanbad, Hazaribagh, Lohardaga and Ranchi) out of 24 districts in Jharkhand as a representative sample.

In the final draft, there is a full paragraph on constraints faced by the audit.

In this paragraph, the Principal Accountant General noted down the factors which hindered the audit examination:
“(i) The Department (of Mining and Geology) did not provide any information on the functioning (policy decisions, instructions, corrective measures, monitoring etc.) of State Level Monitoring Committee (SLMC) on District Mineral Foundation Trusts despite repeated requisitions and reminders (between September 2021 and April 2022) by Audit to the Secretary of the Department and Director of Mines followed by active pursuance by audit team.

(ii) Audit requested (October 2021) the Chief Secretary of the state who is also the chairman of State Level Monitoring Committee to intervene in the matter in providing the access to the functions rendered by SLMC in handling the DMFT Funds. However, no response was received even after lapse of more than six months. This impeded the audit mandate as SLMC is the only body established under the Act to handle the Fund centrally at the Apex level. Denial of access to records of SLMC prevented audit from examining and reporting on the performance of SLMC in managing the Fund during the period under the audit (i. e. 2015 to 2020).

(iii) The Secretary of the Department and Director of Mines were also requisitioned and reminded (between August 2021 and April 2022) for production of monthly collection report of DMFT contribution and royalty. However, these were not responded to even after lapse of more than seven months (as on 19th April 2022). This prevented Audit from ascertaining the correctness of DMFT contribution and its actual loss in the state arising from delayed promulgation of DMFT Rules. Besides, the Director of Mines and the Department could not provide data of DMFT collection and expenditure for the year 2020-21 to audit as no authority had been maintaining such records for the state as a whole.

(iv) The Department did not provide, despite repeated reminders, any record for the methodology adopted for selection and prioritisation of schemes or for identification of directly/ indirectly affected area and people in compliance with the Act/ Rules. Such non-production of records from Audit prevents examination of the basis of resource allocation in the absence of mining affected area and people. The matter, therefore, merits examination from a vigilance angle as it is not possible, without impartial investigation, to find out how resources have been allocated and spent on any particular area, cluster or for any set of beneficiaries.

(v) The Director of Mines visited (October 2021) the office of the Principal Accountant General (Audit) and assured to provide all the above records/data/information etc. (which were not produced) besides data dump of Jharkhand Integrated Mines and Minerals Information System (JIMMS) portal. The records however were not produced when audit teams again visited (between November 2021 – April 2022) the office of the Director of Mines who informed audit that data/information called from field offices (DMO) were not received. In the name of data dump, a CD was sent (November 2021) by post to audit which contained excel sheets of DMO wise daily collection of DMFT contributions. No information was available in the CD (excel sheets) how these contributions were arrived at. Thus, audit was prevented from verifying the system of collection and computation of DMFT contributions being captured in JIMMS. The Director of Mines was informed (December 2021) that it was not data dump but excel sheets without any information of the royalty and payable DMFT contribution. Further request (April 2022) to provide data dump was not responded to (as on 19th April 2022).

(vi) Audit forwarded a draft report on audit findings covering the period 2015-2020 on working of DMFTs in October 2021 for response and reply of the Department. No response has been received (as on 19th April 2022) for the Department”.
The performance audit was shared with Chief Secretary with a letter from the Principal Accountant General dated April 20, 2022. In the letter, PAG informed the Chief Secretary that a copy of the final performance audit had already been shared with Secretary, Mining and Geology Department, Jharkhand on April 19, 2022. With that letter PAG office had requested the Secretary of the Mining and Geology Department, to furnish the replies within two weeks and requested the date for an Exit Conference in the first week of May 2022. The letter also reminded that an earlier correspondence dated October 22, 2021 has not been responded to by the office of the Secretary, Mining and Geology Department.

In a file noting, the Chief Secretary, while forwarding this letter, noted:

“Kindly go through it. A reply must be sent without fail by 30/04/2022”.

Has the reply been filed by the Secretary, Geology and Mining Department, who is under the custody of Enforcement Department?

Will the ‘exit conference’ to this performance audit take place soon?

We may have no clue on the probable answers to such questions. However, one thing is certain. If the ruling government indeed wants to walk the talk we heard from the podium of the National Audit Diwas, it must give a consideration to the proposed amendments to CAG (DPC) Act, 1971.

Himanshu Upadhyaya is assistant professor at Azim Premji University.

AAL going for production shortly?

The Hindu | Sumit Bhattacharjee | 09 Feb, 2022

Activity picks up at plant, power plant trial run held

Anrak Aluminium Limited (AAL) which was set up in 2014 with an investment of around ₹6,000 crore at Rachapalle in Makavarapalem mandal of Visakhpatnam district, is yet to go into production. The plant was set up with an installed capacity of 1.5 million tonnes per year, but with the cancellation of G.O. 97 by the Jagan Mohan Reddy government and the company failing to get a linkage for bauxite ore, the operation of the plant has been stalled. Now there are strong rumours that the company is gearing up to start production and it is learnt that initially February 5 was the date given but it had to be postponed to a later date.

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