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Business News/ Industry / Manufacturing/  Firms allowed mining rights in Saranda forests to face scrutiny

New Delhi/Mumbai: The environment ministry has set up a panel to monitor if the companies allowed to mine in Jharkhand’s Saranda forests adhere to the conditions imposed on them when the clearances are given.

The forests are among the most pristine in the country, and have huge mineral wealth.

Steel Authority of India Ltd recently got an in-principle approval from the environment ministry to mine in the forests, Mint reported on 17 January. Environment minister M. Veerappa Moily needs to sign off before a final approval is granted to the state-owned steel maker.

Multinational steel maker ArcelorMittal’s proposal to mine in the same area is pending. The forests, in Jharkhand’s West Singhbhum district, are rich in biodiversity and form a part of the Singhbhum elephant reserve. According to the Saranda Development Plan website of the district administration, “6,974 hectare of forest land is under mining leases to public sector company (Steel Authority of India) and 2,531 hectare under mining lease to 15 private sector companies," out of the total 85,654 hectares of forest land in the area.

So far, around 2,000 hectares of forest has been diverted for mining under the Forest Conservation Act by the environment ministry.

A government official said the panel will have members from the environment ministry, state and district officials, and environment experts. “There will be a total of 8-10 members," the official said, requesting anonymity.

Tata Steel Ltd, JSW Steel Ltd and Jindal Steel and Power Ltd (JSPL), among other companies, have mining leases in the area, a second government official said, also declining to be identified.

A spokesperson for JSPL said the company has been allotted Jeraldaburu iron ore mine in the West Singhbhum district of Jharkhand and the mine has been allotted for captive use in our steel project in the state. The mine is expected to contain 70-80 million tones of geological reserves of iron ore and JSPL is in the process of complying with the conditions of stage –I clearance granted to the company including the condition of compulsory afforestation.

An ArcelorMittal spokesperson said, “Forest diversion approval from MoEF (ministry of environment and forests) has not been received by us and as such , we are not aware of any compliance conditions." He added that the company is currently working with Jharkhand government for land acquisition for the steel plant.

The other companies did not reply to email questionnaires sent Friday evening until press time.Arun Kejriwal, director of Mumbai-based Kejriwal Research and Investment Services Pvt. Ltd, said the formation of such a panel showed the bureaucratic process of approvals was moving ahead.

“With a few months left to go before the elections, which government will not want to show it is doing its job well?," Kejriwal said. “Forming of such a body also gives these companies less reasons to complain as it shows to them that their process of clearance is being worked upon by the government."

JSW Steel has been allowed to divert an additional 20.43 hectares in the Saranda forests for mining, according to the minutes of an environment ministry committee’s meeting in November. It already had in-principle approval for mining in 998.07 hectares of the Saranda forests. The ministry’s committee, while granting the additional clearance, laid down conditions including compensatory afforestation, which requires the company to take up plantation on a degraded land to compensate for the forest area diverted for its activities.

Compensatory afforestation is one of the many conditions being imposed before granting forest clearances for a project.

According to Kejriwal, actual development of mines by companies in the Saranda forests will take much longer to begin, and investors are unlikely to be impressed with any news of progress. “Looking at the track record of the mining sector where Shah Commission took so many years to study illegal mining and there is still no clarity on what it could do to the sector, it is unlikely that Saranda will see mines developing in a hurry," he said.

The Shah Commission, set up in 2010 to inquire and determine the impact of illegal mining of iron ore and manganese ore in the country, has found a number of irregularities and violations under the Environment (Protection) Act and the Forest Conservation Act.

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Updated: 25 Jan 2014, 11:24 AM IST
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