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Uncertainty over renewal of work permit to KIOCL

By S.K. Ramoo

BANGALORE, JULY 26. The Kudremukh Iron Ore Company Limited (KIOCL) in Karnataka, a 100 per cent export-oriented public sector unit, with a proven track record of safeguarding ecology and environment, is now on the horns of a dilemma. It is awaiting the yearly work permit from the Karnataka and Central Governments for continuing mining operations. The one-year work permit granted last year expired on Tuesday.

Environment groups, voluntary organisations and local legislators have jointly launched a strident campaign to pressure the S.M. Krishna Government not to renew the work permit to the KIOCL. In their perception, 30 years of continuous mining in the Aroli- Gangamoola Range of the Western Ghats, a bio-diversity reserve harbouring unique flora, fauna and wild species, has caused irreparable damage to the ecology. The mining region is part of the Kudremukh National Park, although the Karnataka Government denotified 3,703.55 hectares as the mining zone. The State's major rivers, Tunga, Bhadra and Nethravathy, originate in the Western Ghats. According to them, mining within the catchment area of the Bhadra reservoir has led to severe pollution.

The State Cabinet, which met last week to consider the issue of granting the work permit to the KIOCL, deferred its decision. The Chief Minister, Mr. S.M. Krishna, decided to seek clarifications from the KIOCL on the objections and apprehensions expressed by environmental groups.

Meanwhile, a large delegation headed by the Jnanpith award winner, Dr. U.R. Anantha Murthy, last week submitted a memorandum to the Chief Minister urging the Government not to renew the work permit. According to the memorandum, three decades of mining in the eco-sensitive Western Ghats have had a devastating impact. It argued that environmental concerns should outweigh commercial considerations, including earning of precious foreign exchange. The KIOCL's 30-year mining lease expired on July 24, 1999. Since then, the Karnataka and Central Governments have been sanctioning work permits on a yearly basis as they have not responded to its plea for granting a long-term mining lease for 20 more years.

Environment issue

The Environmental Impact Assessment (EIA) and the Environment Management Plan (EMP) instituted by the National Environmental Engineering Research Institute (NEERI), Nagpur, have given a `clean chit' to the KIOCL on its open-cast mining. Another study conducted by the Indian Institute of Science, Bangalore, has also not entertained any reservations on its mining activity, but has categorically asserted that the current mining area should not be expanded to include the Neelibeedu and Gangerikal regions. The favourable findings of these two prestigious expert organisations have reinforced the KIOCL's assertion that its mining operations have not damaged the ecology and the environment.

The Karnataka Government's predicament stems from the fact it cannot be instrumental in the closure of the profit- making KIOCL. It cannot turn a blind eye to the annual earning of $ 150 million foreign exchange. It is boosting the State's revenue by payment of royalty, sales tax and entry tax to the tune of Rs. 2.5 crores annually. It also has emerged as one of the biggest customers of the Karnataka Power Transmission Corporation Ltd. (KPTCL) as it is paying a mammoth power bill of Rs. 220 crores annually. The Mangalore Port is also receiving Rs. 3 crores annually by way of port charges and another Rs. 2.5 crores as land rent charges as the ore and pellets are exported through it to China, Iran, Australia, Turkey and Japan. It has entered into long-term contracts with China and other countries for the supply of ore concentrate. Any failure to honour these overseas contracts will result in violation of agreements, inviting heavy penalties. Since these are Government-to- Government agreements, the reputation of the country is at stake. During 2000-2001, it has signed fresh annual contracts with some international buyers for the supply of concentrate and pellets. It is envisaged to incur a massive investment of Rs. 650 crores in the Ninth Plan on several ongoing projects.

The Government also cannot be oblivious to the fact that 2,500 of its employees and another 10,000 dependent on it would lose their livelihood. The infrastructure created over the years by spending Rs. 3,000 crores cannot go unutilised. It has so far exported 210 million tonnes of ore concentrate and its mining zone has a stockpile of weathered ore of about 140 million tonnes and beneath it another 350 million tonnes of primary ore, enabling mining operations for another 20 years. To preserve the ecology and environment, it is executing a master plan for the preservation of existing fauna and flora, and has planted 80 lakh seedlings for providing a green cover over its degraded land. It has signed an MoU with Mangalore University for the promotion of local species on its degraded region at a cost of Rs. 50 lakhs in five years. It has signed another MoU with NEERI for evolving a bio-fertilizer for supplementing soil nutrients for nurturing natural vegetation. It has developed a unique ``Sanjivini'' Garden at Kudremukh for the advancement of herbal and medicinal plants and has undertaken experimental plantations.

A study of satellite imagery of the region by the National Remote Sensing Agency, Hyderabad, has revealed conservation of natural forests and a vast improvement of degraded land on account of afforestation. It has also provided valuable information relating to ecological conditions of the mining.

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