To
Shri V L Kantha Rao
Union Secretary (Mines)
Dear Shri Kantha Rao,
Please refer to my letter of 16th November 2024 pointing out that allotment of the Dagocha gold mine to HZL, a subsidiary of the Vedanta Group in Udaipur District in Rajasthan violated two Central legislations, namely, PESA & FRAS, that protect the interests of tribals, since the area where the mine is located lies within a Scheduled Area.
Close on the heels of that mine allocation, I hear that the same company has also been allotted a tungsten mine over 5,000 acres of ecologically sensitive area of Melur, Arittapatti, Terkutteru,
Muthuvelpatti, Kulanipatti, Kidaripatti, Etimangalam, Vallalappatti, Sillippyapatti and Chettiyarpatti, also covering Melur tank in Tamil Nadu. It appears that Tamil Nadu government, recognising the importance of Arittapatti region for its Jain beds, caves and biodiversity, declared it as bio-diversity heritage site to protect it from any development activities such as quarry and mining. (https://www.thehindu.com/news/cities/Madurai/tn-govt-should-oppose-vedantas-tungsten-mining-in-madurai-to-avoid-another-thoothukudi-sterlite-tragedy-activists/article68882758.ece)
I am surprised that your government, perhaps endorsed by the other counterpart departments at the Centre, should allot scores of such highly valuable mineral blocks to one single group, with its parent company listed in London, struggling to repay its heavy debt. The cumulative potential value of the mines allotted to the Vedanta Group so far may run into billions of dollars for which, I am sure, that PSU banks would finally be forced to provide risk-prone loans, driving the latter into facing NPAs.
The same Vedanta Group has dragged Government of India to an international arbitration court claiming its right to buy the residual 30% equity share in HZL, forcing the government to face irritant litigation at huge expenses at the cost of the public exchequer (https://www.livemint.com/companies/news/vedanta-hindustan-zinc-stake-dispute-arbitration-india-uk-treaty-government-supreme-court-bilateral-investment-treaty-11731472052294.html)
What distresses me is that the Vedanta Group on the one hand should be wantonly allowed to bleed HZL of its scarce internal resources by way of payment of excessive dividends (perhaps violative of Section 123 of the Companies Act) to enable its overseas parent company to repay its debt and, on the other hand, be allowed to get away with billions of dollars’ worth mineral blocks for which mostly PSU banks would have to bear the brunt, all in the midst of contentious arbitration litigation into which the group has dragged the government.
Past toxic experience with Vedanta Group’s copper-smelting operations at Tuticorin in Tamil Nadu are far too well known to the people of Tamil Nadu and the rest of India, for me to elaborate on it further.
How can Vedanta be allowed to undertake mining in an ecologically sensitive area that the Tamil Nadu government itself has recognised as a biodiversity heritage site, without prior consultation with the State and without taking the local communities into confidence? It defies all democratic norms and violates the spirit of federalism that lies at the heart of our Constitution.
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Recent scientific literature suggests the risks exerted by tungsten alloys, its dusts and particulates induce cancer and several other adverse effects on the heath of people and livestock (https://www.eurekaselect.com/article/83122). I am not sure as to the role of the Ministry of Environment in allowing such mining activity to be taken up in view of the huge social costs involved.
I hope that the Tamil Nadu government, which has always stood for upholding the spirit of federalism will take this up with the Centre, respecting the sentiments of the local communities.
Regards,
Yours sincerely,
EAS Sarma
Former Secretary to the Government of India
Visakhapatnam
