London-listed Vedanta Resources PLC’s (VED.LN) plan to mine bauxite in eastern India’s Orissa state has hit a roadblock with a majority of village councils in the area rejecting the proposal.
India’s Supreme Court in April asked the village councils to decide within three months on whether or not to allow the company to mine around the Niyamgiri mountain, which is sacred to members of the local Dongria Kondh tribe.
Eight of the 12 village councils in the area have rejected the plan and the remaining are expected to give their opinion on Aug. 19, said a state government official, who works for a department that oversees welfare programs aimed at tribal communities.
The eighth Gram Sabha held in a row in hill slope village of Odisha‘s Kalahandi district today rejected the proposal to allow bauxite mining for Vedanta Aluminium on Niyamgiri Hill.
All the four voters, who attended the Gram Sabha proceedings conducted under the supervision of district and sessions judge at Ijurupa village in Lanjigarh, expressed their views against the mining proposal in Niyamgiri.
With this, all the eight out of the 12 gram sabhas held so far have rejected the mining proposal on Niyamgiri.
The residents of the tiny village strongly opposed mining proposal, saying it would infringe upon their religious and cultural rights. Their views were similar to those voiced in all seven village level meetings held earlier in various villages of Rayagada and Kalahandi districts.
The villages where Gram Sabhas have been held so far are: Serkapalli, Kesarpadi, Todijhola (all in Rayagada district), Kanakudu, Batudi, Palbiri, Phuldumer and Ijurupa (all located in Kalahandi district).
The process of holding gram sabhas in Kalahandi district has been completed. The remaining four gram sabhas are slated to be conducted in different villages located in adjoining Rayagada district, sources said.
The four major villages where Gram Sabha is yet to be held are Khambesi, Jarapa, Lakhapada and Lamba.
Niyamgiri spreads across 240 sq km area Dongaria Kandhs and other tribal groups worship Niyam raja as their protector. Therefore, they have been opposing any move to allow mining activities in the area.
The village level meetings are being held as per the order of the Supreme Court which on April 18 asked Odisha government to conduct gram sabhas to ascertain the opinion of the tribals living in Niyamgiri area with regard to the mining proposal on the hills.
In 2010, India’s Ministry of Environment and Forests banned mining in the area following fierce protests from local and international activists who said the project would cause grave damage to the local environment and the Dongria Kondh community. The court sought the decision of the village councils after state-owned Orissa Mining Co., which has a mining joint venture with Vedanta, required it to repeal the ban.
A Vedanta spokesman in India didn’t immediately comment.
Company executives had in the past said that its investment in Orissa had been made based on assurance from the government on mining rights.
Getting land for mining and industrial projects is a major problem as India doesn’t have a clear policy on the compensation to be paid to landowners and the steps to rehabilitate them, though amendments to land-acquisition and mining rules have been proposed to simplify the process. Steelmakers ArcelorMittal and Posco cited difficulties in getting land as a reason for scrapping two multibillion-dollar projects this month.
Vedanta has an alumina refinery near the proposed mining site that it opened in 2007. The Niyamgiri mine was expected to supply 78 million tons of bauxite, enough to keep the Lanjigarh refinery running for about four years, and provide cheap alumina to the company’s aluminum plant at Jharsuguda, also in Orissa state.
Liberum Capital had said the mine could reduce Vedanta’s aluminum production cost by a fifth, making it one of the world’s cheapest aluminum producers.
Vedanta has invested about 10 billion to date in the state to build the alumina refinery and aluminum smelter as well as a power plant.
Write to Biman Mukherji at [email protected]
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