US rights body indicts Indian mining

BS Reporter / New Delhi Jun 15, 2012,
Human Rights Watch (HRW), a New York-based non-government body, has issued a report on major failures of governance and regulation in the Indian mining sector. Explaining how regulatory lapses led to criminality, it has said former Karnataka minister and mining magnate Janardhana Reddy allegedly used his official position to extort huge quantities of iron ore from other operators, using government regulators as part of his scheme.

HRW has said Reddy may have run an extortion racket in the state, along with his brothers Karunakara and Somashekara Reddy, usurping mineral production of other miners in return for providing protection from government regulation. Reddy, who is currently in Bangalore Central Prison as an accused in the Obulapuram Mining Company (OMC) scam, could not be contacted.

The report titled ‘Out of Control–Mining, Regulatory failure and Human Rights in India’, state the Reddy brothers claimed they did no mining in Karnataka, as their company, OMC, operated from neighbouring Andhra Pradesh. “In a way, this was true – the Reddys allegedly made a fortune by extorting production from mine operators in Karnataka rather than taking over mines themselves,” it said.
According to HRW Reddy’s “interlocutors” allegedly approached Bellary mine owners and told them the government would shut their operations unless they handed over part of their production. “The Reddys were running a protection racket using the very government regulators meant to oversee the industry,” says the 69-page report, issued on Thursday in Goa.

HRW’s findings are based on a six-week field research done in two of India’s principal mining states, Goa and Karnataka, between May and September last year. The research included site visits, interactions with government officials, companies and locals affected by mining operations and collating mining-related documents.

The report, authored by HRW’s senior researcher, Chris Albin-Lackey, says state government agencies in Karnataka alone mighty have been cheated out of billions of rupees in revenue, depriving the state of funds that could have been put towards improvement of the healthcare and education systems.

In Goa, says HRW, local communities suffer from human rights abuse, including respiratory problems owing to dust emissions from trucks loaded with iron ore and pollution of water bodies and loss of agricultural land fertility due to irresponsible waste disposal from mines.

At a national level, HRW’s report says the steps taken by the government to address the issue, including the Mines and Minerals Development and Regulation (MMDR) Bill, 2011, remain severely wanting. “The draft legislation does not address many of the core problems, and does not purport to.” The benefit sharing mechanism in the Bill would require vigorous and transparent implementation to be a success, the report said.

Among its major recommendations to the government are to improve the Environment Impact Assessment (EIA) regime. The government should immediately end the current practice where project proponents themselves select and fund the consultants who do the EIA report. HRW has also requested a United Nations Special Rapporteur on the Right to Health to visit India to assess the impact of inadequate regulation on the rights of Indians to health and water.