Vedanta Chairman Anil Agarwal lobbied intensively and successfully to have environmental regulation weakened in favour of mining companies and oil exploration companies, the Organized Crime and Corruption Reporting (OCCRP) has alleged in a new report.
The accusation against came a day after the non-profit global network of investigative journalists levelled a broadside at the Adani Group, accusing family partners of using offshore funds to invest in the Indian conglomerate’s stocks.
OCCRP alleged that Vedanta Chairman Anil Agarwal played a key role in persuading the government to relax its environmental standards massively so that mining companies could hike production by 50 per cent without holding public hearings.
The report claimed that the Ministry of Environment held a series of closed-door meetings and altered its rules about hiking production without any public hearings. The announcement of the changes was made via an office memo put up on its website. The new rules came into effect in early 2022.
Vedanta has also, according to OCCRP, played an important part in changing the Environmental Impact Assessment law so that no public hearings were needed for oil-and-gas exploration projects.
The mining giant in a statement did not admit or deny the claims, but said “continuous representations are submitted for consideration to the Government in the best interest of national development and India's march towards self-reliance in natural resources."
Friday’s report by OCCRP on Vedanta and the relaxation of environmental rules follows one which appeared on Thursday focusing on the Adani group. OCCRP’s second report looked at the Vedanta group and how it worked behind the scenes to have environmental rules changed.
OCCRP also notes that Vedanta was a major donor to the BJP party coffers. “Contribution reports analyzed by OCCRP show that two Vedanta-linked trusts alone donated $6.16 million to the party between 2016 and 2020.” In addition to this, Vedanta’s annual reports between 2021-23 show that it bought $35 million worth of electoral bonds. However, it’s not clear how much of this went to the ruling party and how much to other political parties.
In a letter to the environment ministry, Agarwal wrote that allowing mining companies a 50 per cent hike without public hearings “would generate huge revenue for the Government and create massive jobs.”
Prakash Javadekar, who was the environment minister at the time appears to have responded positively to Agarwal’s suggestion and forwarded it to his top bureaucrats with the note: “VIMP (Very Important). Discuss (the) policy issue”. The letter was sent to the secretary, Ministry of Environment and the director-general of forestry.
Says OCCRP: “Though the head of a major industry lobby group and India’s mining secretary also pressed for the rules to be loosened, internal documents and government sources suggest Vedanta’s lobbying was key.”
The mining industry had been lobbying for years to do away with rules that required companies to hold public hearings every time they wanted to hike production. However, their efforts were unsuccessful. Says OCCRP: “Internal documents show it was only discussed seriously again when Vedanta’s chairman wrote to the environment minister in January 2021.”
There was considerable opposition within the ministry to allowing increased production without public hearings. Finally, Bhupender Yadav, who had taken over from Javadekar in July 2021, permitted a 20 per cent hike in production without holding public hearings.
But he then received a letter from Cabinet Secretary Rajiv Gauba instructing the ministry to review its processes for approving projects. Gauba is the country’s top bureaucrat and reports directly to Prime Minister Narendra Modi. Says OCCRP: “This was understood as an order to alter a variety of regulations including for the mining sector.”
Vedanta-controlled oil exploration company Cairn Oil & Gas has the rights to 62 oil exploration projects and had lobbied intensively to drop public hearings for such projects. Says OCCRP: “As with mining, the government quietly amended the law with no public consultation. Since then, at least six of Cairn’s oil projects in the northern deserts of Rajasthan have been greenlit for development.” The company argues that such projects are temporary and, therefore, do not need public clearance.
A Cairn spokesperson told OCCRP that the company has “received all the necessary approvals for its oil and gas projects, including convening public hearings and engaging with local stakeholders in line with the advice of the state government.”
Cairn wrote to the environment ministry in March 2019, insisting that public hearings were not needed for oil exploration projects and that it was backed by the director-general of hydrocarbons, V. P. Joy. In January 2020, the rules were amended to exempt oil and gas companies from having to hold public hearings.
