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HindustanTimes Fri,22 Aug 2014

Minerals, money, marauders earth quakes in MP

Rahul Noronha and Padma Shastri, Hindustan Times  Bhopal, November 27, 2012
First Published: 16:32 IST(27/11/2012) | Last Updated: 16:39 IST(27/11/2012)

Illegal mining has always existed. What has changed over the years is its money-making potential --reflecting the increasing demand and value of mineral resources.

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The real estate and housing boom, a growing manufacturing sector, ever-increasing demand in the international market have made minerals like sand, iron ore, bauxite, coal, copper ore (all found in abundance in MP) sure-fire money-spinners.

The National Mineral Policy of 2008 states: “As the country develops and industry grows, assured availability and proximity of mineral resources will play an important role in giving a competitive edge to Indian industry. The multiplier effect of minerals processed into metals on downstream industrialisation cannot be over-emphasised.”

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Revenues from mining in Madhya Pradesh stood at about Rs. 3,114 crore at the end of the last fiscal.

Estimates vary on the size of the illegal mining sector, but a conservative assessment would peg the illegal mining market to be at least twice that of the legal market.

Consider this. “The area around Katni has always been rich in mineral resources. However, from the mid 2000s, the marble from Katni suddenly found itself in demand at the international market. Along with this, there was a sudden demand from China for iron ore. It was as if people suddenly stumbled upon a valuable treasure which had always been there, but its value had suddenly been revealed,” said RK Singh, a mineowner in Katni.

Among the minerals available in MP, there are some that are more attractive than others for the illegal mining industry.

Sand and sandstone are more prone to be mined illegally simply because the end users are locals.

Illegally mined coal and iron ore, on the other hand, need big industrial buyers and are therefore more difficult to sell.

The area where illegal mining found its most secure footing in the state since the early 2000 was Chambal division.

Illegal sand mining from the banks of Chambal river is rampant, even though the area comes under a wildlife sanctuary.

The MP State Mining Development Corporation mined a total of 78 lakh tonnes of sand valued at about Rs.40 crore in 2010.

“The sale of illegally mined sand could be easily in the Rs. 100 crore range, and this is a conservative estimate,” said a former mining department official, not wishing to be named.

While a lot of the sand is mined by end-users themselves, a substantial amount is channeled out to bordering Uttar Pradesh and Rajasthan.

The business has always been controlled by local strongmen with political patronage and now it is almost completely mechanised with JCB machines and dumpers.

Illegally mined sand is priced at about a third of the legally mined variety. While a tractor trolley with a capacity of 100 cubic feet costs Rs.4,000 in the regular market, the same sand can be delivered at just Rs.1,500 in the gray market.

In a time and age when cost of construction is rising, saving on a key input like sand does not hurt anyone - more so, when no one is watching.

Similar is the case of iron ore in Katni. Legally mined iron ore is sold for about Rs.1,500 per tonne, while the illegally mined ‘version’ is sold to factories in neighbouring Chhattisgarh for a mere Rs.500 a ton.

Ajay Dubey of the voluntary agency Prayatna had filed a Public Interest Litigation (PIL) in the high court which led to environmental clearance being made mandatory for all mines.

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He alleges that there is huge gap between what the government claims by way of action against illegal mining, and what actually is done.

“Based on my field experiences and RTI applications filed, the action by the government against illegal mining is only on paper. Government machinery including politicians and bureaucrats are part of the illegal mining activity. This is reflected in the resistance by the government in bringing in new technology like GPS and satellite-based applications which can restrict illegal mining,” said Dubey.

He added that many other states have taken to this technology to check illegal mining, but MP is resistant to this change.


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