‘Vedanta’ Revisited

‘Might isn’t always Right’

Oliver Tickell

The mining controversial project by the UK-listed mining company Vedanta Resources has been stopped by India's authorities.

The mine would have turned the huge tract of the Niyamgiri Hills in Orissa state—which are sacred to the Dongria Kondh tribe—into a huge open pit mine.

"We rejected it after the local panchayats rejected", India's Environment Minister Veerappa Moily said in New Delhi sometime ago, referring to village governance bodies. "That's what we're doing for most projects".
The mine would have produced high quality bauxite, the mineral used to make aluminium—used in a wide range of domestic and industrial applications.

Vedanta had failed to seek the consent of the Dongria before embarking on the project—and even built a refinery at the bottom of the Niyamgiri Hills, which cost the company an estimated US$800 million.

Vedanta was founded by Indian billionaire Anil Agarwal, who owns more than half the shares. The company claims on its website: "We are India's largest non-ferrous metals and mining company and are one of the fastest growing private sector companies."

"Strelite Industries constantly works towards building a greener planet. We have always focussed our efforts in ensuring environmental protection while conducting all our operations. We do so by improving the designs or resorting to alternative and sustainable means."

"Our strategy for sustainability is based on the pillars that are the crux of Vedanta's sustainable development: Environmental Stewardship; Empowering Communities; Nurturing People; Health and Safety."

But according to a Bloomberg report, the company's aluminium business is now in severe trouble. "The Environment Ministry's decision adds to billionaire Anil Agarwal's troubles in India's metals industry. London-listed Vedanta has 1.25 million metric tons of new aluminum refining capacity lying idle because of a lack of bauxite."

Goutam Chakraborty, a Mumbai-based research analyst at Emkay Global Financial Services Ltd, said: "This is the end of the Niyamgiri project. Even if Vedanta looks at new mines for sourcing bauxite, it will take them at least 4 to 5 years."

Stock market information was unavailable today on the company's website.

The decision to stop the mining project follows unprecedented consultations with Dongria Kondh villages surrounding the mine site, which were ordered by India's Supreme Court on 18th April 2013 and dubbed the country's first ever 'environmental referendum'.

Tribal rights over land are recognized and the tribal peoples' local authority must clear the proposal, the three-judge panel headed by Aftab Alam of the Supreme Court ruled.

All twelve Dongria Kondh villages involved in the consultation rejected Vedanta's project in July 2013 in the face of intimidation and harassment. But the final decision lay with the Ministry for Environment and Forests.

Vedanta's defeat will have global repercussions for companies intent on working on tribal peoples' lands and should serve as a lesson that tribal communities' prior consent must always be sought, says Survival International.

The London-based group has been at the forefront of a global campaign supporting the Dongria's struggle against Vedanta Resources, and persuaded celebrities such as Joanna Lumley and Michael Palin to champion the tribe's cause.

Actor Joanna Lumley, who narrated Survival's short film 'Mine' about the Dongria's plight, said:
"I am thrilled and delighted by this marvellous news. It shows that there really is hope for the 'little people' of the world, standing up against governments and the greed of large corporations. The strength and resilience of the Dongria Kondh people has been both inspirational and humbling."

Comedian, actor, writer and television presenter Michael Palin said, "This is a rare and hugely significant success. In a classic David and Goliath confrontation big business has been legally held to account by the voices of those whose world was about to be turned upside down."

Vedanta's mine project was strongly criticised by the British government in 2009 after Survival submitted a complaint to the OECD.

The British Government ruled that Vedanta, "did not respect the rights of the Dongria Kondh"; "did not consider the impact of the construction of the mine on the [tribe's] rights"; and "failed to put in place an adequate and timely consultation mechanism".

"Vedanta did not respect the rights and freedoms of the Dongria Kondh consistent with India's commitments under various international human rights instruments, including the UN International Covenant on Civil and Political Rights, the UN Convention on the Elimination of All Forms of Racial Discrimination, the Convention on Biological Diversity and the UN Declaration on the Rights of Indigenous People."

It concluded that a change in Vedanta's behaviour was "essential". Despite repeated requests from the UK government, the company "failed to provide any evidence during the examination".

This was the only time a company had refused to participate in an OECD investigation. Several shareholders, such as the Church of England, sold their company shares on ethical grounds.

Investigations in India also criticised the project, and in August of that year India's Environment Minister admitted that the project should never have been approved.

Booker Prize-winning author Arundhati Roy commented at the time: "If Vedanta is allowed to go ahead with its plans for mining the Niyamgiri Hills in Orissa for bauxite it will lead to the devastation of a whole ecosystem, and the destruction of not just the Dongria Kondh tribal community, but eventually all those whose livelihoods depend on that ecosystem."

The Dongria have been supported by Rahul Gandhi, Vice-President of India's National Congress Party and son of Sonia Gandhi, who had promised to be the Dongria's "foot soldier" in Delhi.

He had twice before visited the Niyamgiri Hills to show his support for the Dongria's struggle against the Vedanta mine.

Survival's Director Stephen Corry said today: "Many people wrongly believe that the fight for tribal peoples' rights is unwinnable, especially when they're pitched against huge multinationals like Vedanta.

"But this outcome shows that might isn't always right. The Dongria's determination, coupled with overwhelming public support, has set a new precedent for tribal rights in India."


Vol. 46, No. 37, Mar 23 - 29, 2014