The opposition by businesses to some proposals in the draft mining Bill is hardly surprising. Keeping 26% of equity in the project for those displaced by mining projects, as suggested by the group of ministers tasked with drafting the Bill, would significantly increase what companies pay project-affected people. Indeed, it would raise accountability for mining projects, and set a precedent for projects related to metals and other heavy industries. Equally, the Bill would spotlight not only those displaced by projects, but also those who are affected by projects—a nuance usually either not understood, or ignored. And, it would raise the bar to prevent businesses from wilfully confusing resettlement with rehabilitation.
Businesses will attempt to dilute suggestions in the Mines and Mineral Development (Amendment) Bill. And, later this year, businesses will attempt to pressure its demise in Parliament, should the Bill be introduced during the winter session.
This opposition is neither new nor restricted to India. Businesses in Canada are opposing “an Act respecting corporate accountability for mining, oil and gas corporations in developing countries”. Generally known as the “Responsible Mining Bill”, it seeks to ensure that businesses which receive Canadian government funding and operate in developing countries will follow international human rights and environment standards. Forces are gathering for and against the Bill in time for a crucial hearing in the House of Commons in late October.
In Peru, the government of Alan Garcia intervened to send back to Congress a Bill it had approved this past May that required the government to seek counsel and consultation for any project it approved that had the potential to jeopardize the rights of indigenous people. The Business and Human Rights Resource Centre records that Garcia went to the extent of denying indigenous status to those in the Sierra region—the country’s pre-eminent mining area for gold and copper, among other minerals—and the Costa region, an agro-hub. Basically, the resource centre notes the intervention will lead to denial of the right to seek consultation, and violation of free, prior and informed consent of communities affected by mining and other projects that require vast swathes of land.
The situation in India is similar, because both Central and several state governments and their various administrative and law-keeping arms have, over the years, aided and abetted the abuse of human rights related to business practices. Free, prior and informed consent is farcical in states such as Orissa, West Bengal, Jharkhand, Chhattisgarh and Karnataka, where extractive and heavy industry projects by prestigious Indian and global names are both ongoing and planned. It is only because the path of growth in these industries has intersected with the path and growth of the Maoist rebellion in recent years that India’s leadership has awoken to a problem they have helped to worsen.
The proposed mining Bill needs to look beyond the question of annuity, the sharing of resources with the project-affected. The point of liability that goes beyond financial responsibility needs to be injected into the Bill. The concept of free, prior and informed consent needs to be made mandatory; any violation or abuse of it needs to be investigated, to prevent the rampant practice of district administrations and superintendents of police—under orders of their higher-ups—becoming extensions of corporate will to strong-arm the procurement of assent, for instance, for acquisition of land for projects.
And what of projects that are already up and running, where there is gross abuse of human rights and every manner of consent not only with those displaced by the project, but also those in danger of losing their homes and livelihood in nearby areas on account of mining and industrial waste? What of projects that will have received clearance prior to the passage of this Bill into an Act, should that ever come to pass? Will the Bill provide retrospective succour?
There is talk of a district mineral foundation in the Bill, a device to channel funds from businesses to finance resettlement and rehabilitation of project-affected people. Will the Bill fashion safeguards, so this government-administered hub of funds doesn’t siphon off, as is the norm, what is meant for specific public good; or, let businesses off the hook should they stall payment?
The Bill is an opportunity to do right, to inject governance and corporate governance; and, social responsibility and corporate social responsibility. It’s way past the time for government and business to walk the talk.
Sudeep Chakravarti writes on issues related to conflicts in South Asia. He is the author of Red Sun: Travels in Naxalite Country. He writes a column alternate Thursdays on conflicts that directly affect business.
To read all of Sudeep Chakravarti’s earlier columns, go to www.livemint.com/rootcause
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