Auctioning mineral blocks without consulting the other Central Ministries and the States violates the spirit of federalism

The Teck Mining Co open pit Elk River Valley coal mines


Shri A. L. Meena

Secretary (Coal)

Govt of India


Shri Manoj Ahuja

Secretary (Agriculture)

Govt of India

Dear S/Shri Meena and Ahuja,

I understand that the Ministry of Coal has recently auctioned three lignite blocks, East of Sethiathope, Michaelpatti and Vadasery, which are located in the fertile Cauvery delta region of Tamil Nadu, considered the rice bowl of the State. I am surprised that the Ministry of Coal should unilaterally auction the blocks despite their location in such a fertile region, that too, without consulting the State which has a heavy stake in the region. Apparently, the Ministry of Coal has also not consulted the Ministry of Agriculture.

It is reported ( that the Tamil Nadu Chief Minister has vehemently opposed the auction as the Cauvery Delta region has been notified as “protected” under the Tamil Nadu Protected Agricultural Zone Development Act, 2020. Considering the importance of agriculture for the economy of Tamil Nadu and since the welfare of the farming community depends critically on agricultural activity in the Cauvery Delta, the State has rightly questioned the unilateral action taken by the Ministry of Coal.

The Ministry of Coal has displayed undue haste in auctioning mineral (coal/lignite) blocks to private companies, without evaluating the environmental and social costs involved. The least that the Ministry could do is to consult the concerned Ministries at the Centre and the concerned States, to understand the impact of mining on the local communities.

Apparently, the Ministry of Coal is unaware of the fact that, in the Scheduled Areas notified under the Fifth Schedule and other forest areas, where most of the mineral blocks are located, there are protective laws such as the PESA and the FRA that prohibit the unilateral imposition of mining without the prior consent of the local Gram Sabhas. Auctions conducted ignoring such legislations are therefore prima facie illegal. In some States where there are Scheduled Areas, there are statutory provisions that prohibit the entry of private agencies, a legal position reiterated by the apex court in the Samatha case.

Similarly, Tamil Nadu has legislation in force to protect its agricultural lands. In a few other States too, such laws may be in force.

Section 10 of the 2013 land acquisition legislation introduced by the Centre empowers the States to restrict land acquisition so as to ensure that the food security in each region is fully safeguarded.

Should the Ministry of Coal violate those statutory provisions in its anxiety to hand over mineral blocks to a few private conglomerates?

Has the Ministry made an evaluation of the impact of mining on agricultural production in the Cauvery Delta and the consequent loss of rural employment before deciding to auction the three lignite blocks?

Similarly, has the Ministry assessed the economic loss arising from the loss of forest resources, the loss of biodiversity and loss of river catchments in forest areas where some mineral blocks are located?

If it has not attempted such an evaluation, which I feel has not been done, the whole exercise of auctioning mineral blocks lacks legitimacy and credibility.

There are reports that some influential private conglomerates are cornering mineral blocks for less-than-market prices by scuttling competition through unethical means. If those reports are correct, a time has come for the Centre to put a stop to mineral block auctions.

Natural resources like minerals belong to the people and the role of either the Centre or the State is that of a public trustee, a premise reiterated by the apex court in several cases. The manner in which the Centre has embarked on indiscriminate mineral block auctions amounts to a breach of such public trust.

May I request the concerned Ministries to come together and formulate a more credible, legitimate approach to mineral development. The Centre cannot proceed unilaterally without taking the States in confidence.


Yours sincerely,

E A S Sarma
Former Secretary to the Government  of India


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