Mahan at all costs

WHEN Madhya Pradesh chief minister Shivraj Singh Chouhan went on an “indefinite” fast in February to protest the Centre’s “continued discrimination” against the state, one of his grudges was the delay in the allocation of a coal block to a joint venture of two companies that has invested thousands of crores of rupees in setting up industries in the backward region.

Chouhan called off his fast minutes after beginning it. But there is no let up in the demand for Mahan coal block. The Centre has bent all rules to suit the interest of the companies, Essar Power and Hindalco Industries.

So much so that instead of the Union Ministry of Environment and Forests which is the statutory authority to grant forest clearance, for the first time, a Group of Ministers (GoM) is considering whether to divert more than 1,000 hectares (ha) of dense forest to Mahan Coal Ltd. It is a Rs 5,000-crore joint venture between the London Stock Exchange-listed power company Essar and the aluminium-manufacturing unit of Aditya Birla Group. The GoM is headed by Finance Minister Pranab Mukherjee and includes coal and power ministers.

The Union coal ministry had in 2006 allocated the coal block in Singrauli district to a 1,000 MW power plant proposed by Essar and a 650 MW captive power plant of Hindalco. The coal block was given environmental clearance in December 2008. But before getting forest clearance, Mahan coal block was declared a no-go area, a zone where mining is prohibited because of dense forests. The concept was introduced by former Union environment minister Jairam Ramesh in 2010.

Environment ministry’s contention was that Mahan coal block is under the last remaining patch of very dense, unfragmented forest in Singrauli coalfield region, which spreads across Singrauli and Sidhi districts in Madhya Pradesh and Sonebhadra district of Uttar Pradesh. Some 15 mining projects by industry giants, including Reliance, Hindalco and Jaypee Group, are already operating in the region. Almost one-third of the forestland in the district has been diverted for mining.

Analysts fear the GoM might grant forest clearance to Mahan Coal. It recently endorsed the report by the B K Chaturvedi committee which says the concept of “go” and “no-go” areas has no legal basis and should not be applied while giving forest clearance to coal mining projects. The high-level committee was formed by the GoM in June this year to examine coal blocks in no-go areas and suggest clearance measures.

It found that the go/no-go exercise was conducted only on 37.5 per cent of the country’s coal-bearing areas. Even then there has been a progressive attempt to convert no-go areas into go areas. Initially, of the total blocks surveyed, 396 were designated as go areas and the rest 206 as no-go. But within a year, following interventions of the Prime Minister’s Office (PMO) and change of mind of the environment ministry, more than 70 no-go coal blocks were appended to the go category. As of July 2011, the Chaturvedi report says, there were 470 coal blocks in the go areas (see ‘Auto yes to coal’, Down To Earth, September 1-30, 2011).

Still why should the GoM take decisions on forestland diversions for Mahan Coal, questions Priya Pillai, policy officer of environmental group Greenpeace. “Under the Forest Conservation Act of 1980 the GoM has no authority to do so.”

How it slipped from MoEF’s grasp

On July 8, just before passing the matter to the GoM, Jairam Ramesh said he was “unable to agree” to consider forest clearance for Mahan coal block. He submitted the proposal to the GoM with a recommendation that an alternative source of coal be provided for the power plants of Essar Power and Hindalco Industries. MoEF had earlier suggested Sohagpur coal block in neighbouring Shahdol district, where 70 per cent of the reserve is in the go area, as an alternative source.

The environment ministry’s inability to take a final decision has been cited as the reason for the matter being transferred to the GoM, but correspondence between Ramesh, the industries and PMO, in possession with Down To Earth, shows otherwise. There was intense pressure on the ministry not only from the industries, but also from the state government, the Union coal ministry and the PMO.

Chairperson of the Essar Group, Shashi Ruia, wrote to Prime Minister Manmohan Singh in March 2010 that “65 per cent” of the work on the power plants had been completed and that forest clearance should be expedited. If the project is delayed this will result “in an avoidable huge loss to us as well as the country”, Ruia wrote.

Ramesh received a letter from the prime minister on the very day Ruia wrote. In his reply, Ramesh pointed out that Ruia’s argument for granting forest clearance on the basis of 65 per cent completion of the project was flawed. Work should not have started before forest clearances were granted, Ramesh said, complaining that fait accompli has become far too common. “I am not entirely clear why such a good quality forest area should be broken up for such a partial requirement,” said Ramesh in the letter. By the industries’ own admission, Mahan coal block would meet requirements of the power plants for around 15 years, as against their balance life which could extend for another 10-15 years.