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Court spanner in Vedanta mining plan

New Delhi, Nov. 23: The Supreme Court today refused to clear Vedanta Alumina’s proposal to mine bauxite in Orissa’s Niyamgiri forests but said it would consider any fresh proposal by Vedanta’s Indian unit Sterlite.

“We are not inclined to grant approval to Vedanta Alumina’s mining proposal,” a bench, headed by Chief Justice K.G. Balakrishnan, said in its order.

Vedanta Plc, which was funding the project, had been banned by Norway for violating labour rights and human rights, the court observed.

It instead directed Sterlite to float a special purpose vehicle (SPV) — in which the Orissa government and the Orissa Mining Corporation will be major shareholders — and submit a fresh proposal for mining in the area.

“From the affidavits presented to the court, it seems as if Vedanta is not a subsidiary but only an associate company of Sterlite,” the court said. “We cannot risk handing over such an important national asset to a company unless we are satisfied about its credibility,” the court said.

“But we are not opposed to the project in principle,” the court said. Locals of Lanjigarh, country’s poorest district, live in “abject poverty” and the area needs to be developed, it said.

But any such development would have to be sustainable, it noted. “Sustainable development is a constitutional requirement,” the court said. But the needs of the present would have to be balanced with the needs of future generations,” it said.

“Courts would have to balance both,” it added.

The court indicated that any fresh proposal for mining would have to meet stringent environmental requirements. It would also have to include concrete commitments guaranteeing jobs for the locals and protecting forests and wildlife.

Sterlite business development head C.V. Krishnan said the company would file a fresh application in the court soon, seeking fresh permission in terms of the court order. “We can then go ahead with the project.”

Activists reacted cautiously saying they were “happy that the mining lease had not been given out immediately”. But they added that the court’s decision raised several questions.

“If the credibility of Vedanta is under a cloud, then all mining licences granted to the company so far should be cancelled,” said Fouparna Lahiri of the National Forum for Forest People and Forest Workers.

“What is the rationale behind bringing in Sterlite at this stage,” he said. “Sterlite was not a party to the petition,” he stated. The court is also silent on the impact of bauxite mining on the environment, he said.

“We will now raise questions about the credibility of Sterlite,” he said. “Sterlite is not above board too,” he said.

President of Niyamgiri Suraksha Parishad Kumti Majhi said, “We are excited to know that the court has at last heard our plea and denied permission to Vedanta to take up mining on the sacred Niyamgiri Hills.”

Vedanta has already set up a refinery project in Lanjigarh. But its mining project, expected to source bauxite for the refinery, had run into opposition from several activist groups which said it would have an adverse impact on wildlife and tribals of the area.

The area is home to the Dongria Konds and the Majhi Konds. Besides, it is an elephant corridor. Vedanta’s much-touted Rs 4,000-crore project will destroy these forests, activists said.

Though the refinery project was cleared by the ministry of environment and forests way back on September 22, 2004, the mining project got stuck when a Supreme Court panel recommended that it should be disallowed.

It recommended that an alternative bauxite source be found for the refinery.

But at the insistence of the Orissa government and the Centre, which are keen to see the project through, the apex court seems to have come round to the view that it should be allowed but with all environmental and other safeguards.

Lafarge gets relief

The Supreme Court today allowed French firm Lafarge to continue mining limestone in Meghalaya for use at its cement making plant in Bangladesh.

Lafarge had challenged the order of the ministry of environment and forests issued in May this year asking the company to stop work at quarries on the ground that mining was not permitted in forest areas.

The multinational had also wanted to transport six lakh tonnes of limestone to its cement plant in Bangladesh.

A special bench headed by Balakrishnan in an interim order allowed Lafarge’s plea.

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