Vedanta Resources owner-chairman Anil Agarwal is known for his risk-taking abilities. That skill was displayed again on Monday when he announced his maiden foray into the oil sector with a $9.6-billion deal with Cairn India. But on the same day, it also became clear that — at least in Orissa — his adventurous spirit could take a severe beating. A government-appointed panel indicted the London-based FTSE 100 company, saying that the Centre "should not clear" Vedanta's bauxite mining project in Orissa's Kalahandi district because the company has "consistently" violated the Forest Conservation Act, the Forest Rights Act, the Environment Protection Act and the Orissa Forest Act — in other words, they have breached every law in the book that safeguards the rights of marginalied communities like the Kondhs of the area. Equally scathing is the panel's indictment of the Orissa government's role in the affair: it said that the district administration has been reluctant to act fairly to formalise the rights of the tribals, over the bauxite mining project lease area, as the state government had "already decided to transfer the said land for mining". Orissa's Posco project also faces serious charges.
If there's a takeaway from this and the Posco case, it is this: both the state and the central governments need to clean their own stables. If a corporate has managed to go this far without complying with the laws, then there must be something gravely wrong with our governance systems. If it's Vedanta today, it will be some other company tomorrow. The State-owned mining companies too are not always above board. All across India there are protests against power projects, SEZs and mining projects. And in most cases, the main grouse of the people is often the fact that the district authorities along with project proponents don't even hold public hearings properly. More frightening is the fact that files move back and forth between the state and central governments, yet until there are protests, no one in the bureaucracy questions the illegalities. In fact, the Vedanta report said that earlier the Centre too looked the other way when violations were reported to it.
During interactions with the media, senior Vedanta officials have often talked about the cost advantage of Eastern Ghat bauxite and how vested interests are targeting the company. Corporate rivalry may often upset calculations but that is no excuse for blatantly flouting laws. Vedanta has probably become an iconic case but there are many more companies that will be looking for grabs more than what's due to them. Who'll stop them seems to be the question now.