N. Ravi Kumar and Prakash Kamat take stock of the Goa mining scene

As the mid-day sun blazes across the sprawling mine in Surla, the only sign of activity is the presence of a security guard. On seeing the company vehicle, he promptly adjusts his cap and salutes. The reluctant smile is a give away. It speaks volumes for the silence pervading the mines in Goa. These are the same mines that, for decades until early September, remained a source of employment for thousands. They wear a deserted look today.

Behind the uncertainty bogging the industry, whose export earnings last fiscal were Rs.16,000 crore, are a series of actions of the State and Central governments, environmentalists, and a direction of the Supreme Court. Indeed, there is no smoke without fire, and, in this case, the actions were sparked as a result of doings of some in the industry. It all began in early 2012 with the report of Justice M. B. Shah Commission of Inquiry set up by the Centre.

The findings, says a note prepared by the Goa Mineral Ore Exporters’ Association (GMOEA) and Goa Mining Association, could be categorised into: mining activities outside the lease area/illegal mining; encroachments; renewal of mining lease; mining in eco sensitive zone/violation of buffer zone; and a resultant loss estimated at a whopping Rs.35,000 crore. While welcoming the measures to put an end to illegal mining, the associations dispute the findings.

On its part, the Goa government directed the industry to shut operations. The Union Ministry of Environment and Forests suspended the environment clearances of 93 mines in the coastal State.

Even as the industry was smarting from the twin blows came a public interest litigation petition from Goa Foundation, a non-governmental organisation, against resumption of mining. Following this, the Supreme Court imposed a ban on mining and transportation of iron and manganese ores. It also directed the Centrally-Empowered Committee (CEC) to investigate, which went on to recommend closure of 42 mining leases, and keeping in abeyance the remaining leases till certain conditions were met. The CEC suggested that the Goa government be asked to notify comprehensive rules for storage, transportation and shipment, and not to permit any mining till then. It also stressed on preparation of reclamation rehabilitation on the lines done in Karnataka. The report had recommended that 87 mines be banned permanently, including 42 operating in and within one km of the wild life sanctuaries.

In the meantime, the Union Ministry of Environment and Forests also decided to keep the clearances for 139 mining leases in abeyance, and issued notices to 46 lease holders in connection with handling of dumps. The rapid sequence of events that unfolded in the second-half of 2012 rattled the industry, which according to its estimates, provides jobs to 15,000 people directly and 75,000 indirectly.

The impact is multi-pronged, on the cash flows of many companies, leading to a scare of losing the buyers forever, to a large number of people whose fortunes are closely linked to mining losing their jobs, taking salary cuts and defaulting on loan repayments. These include owners of the 16,000 trucks and 400 barges, those who had set up allied facilities such as spare part shops, garages, kirana shops and hotels.

The manager of a State Bank of India branch, who did not want to be named as he was not authorised to speak to media, said: “They [villagers] eat out of mining, drink out of mining… everything, even the water supplied to them, comes from the mining companies. Their financial health is totally dependent on mining, because agriculture here has been practically destroyed. Nobody thought mining would stop and there would be a ban.” Due to certain measures the bank had taken in the previous years, the impact was not felt in the first few months of the ban, he says, adding “but after that, there had been huge defaults, practically 100 per cent in case of mining.”

In Velguem village, for grocery store owner Tulsidas, who also operates two trucks, including one of his own, the regret is that the ban has come late. “I had my paddy fields all of which have been totally destroyed… had they imposed the ban ten years ago I would be cultivating my field. My two sons also depend on the mining industry. I have no other option. There is no industry on which we can rely.”

On repaying the truck loan obtained from Syndicate Bank, he says till Ganesh Chaturthi last year he paid Rs.28,000 EMI on time, but from September, it has become difficult. Besides losing the revenue from operating the trucks, he is also facing a 75 per cent drop in business from his grocery store. All the workers, including the truck crew, from north Indian States employed in the mines have left, Mr. Tulsidas says.

There is also a good sprinkling of politics in the crisis. Some say the Shah Commission report is a big blot on the erstwhile Congress government in Goa, as it allegedly failed to regulate the affairs in the mining sector. For the ruling BJP government that rode to power on the plank of setting right the wrongs in the industry, it is not easy to restore order either. Chief Minister Manohar Parrikar is said to be upset with the interim report filed by the CEC in the apex court. He is desperate to see mining resume as pressure from miners and others like truck-owners and barge owners mounts.

But if the interim report is any indication, the resumption of mining seems not in sight.

Welcoming the report, anti-mining activists such as Ramesh Gawas and Claude Alvares recommend a macro-level environment impact assessment before resumption of mining.

Feeling the impact of the ban Vinayak Gauns, a member of the Dharbandora panchayat and who heads the truck owners association in his area says the situation could become severe.

The industry is worried. Shivanand V. Salgaocar, Managing Director of V. M. Salgaocar & Bro Pvt. Ltd., says it has resulted in complete lack of confidence in the buyers.

The desperation has also brought disparate forces together. Christopher Fonseca, General Secretary of AITUC (Goa), says: “We have formed Goa Mining People’s Front, a rainbow coalition of all stakeholders in the mining industry. “Mining has been the backbone of Goa. It is something which is given… environment is not something that you cannot rejuvenate,” he says, while adding that the trade union had also fought against the mine owners in the past. “We have been filing cases against them and getting compensation,” he adds.

For the industry, whose contribution to the State GDP was Rs.9,000 crore, about 20 per cent of the total, it is introspection time. S. Sridhar, Executive Director, Goa Mineral Ore Exporters’ Association, says things changed after the China market opened up. Goa had low grade ore, which China wanted, and also the infrastructure. With the State becoming a preferred supplier, “people [with import license] camped in Goa, many offices were opened… they entered the market and spoiled the whole … put pressure on the infrastructure, created havoc and money played a role. Everybody was interested and entered the market. That spoiled the market. We as association can only say we don’t encourage [fly by night operators] but we don’t have the powers to control that.”

The industry is also agitated at the comparisons made between Goa and Karnataka. Mr. Sridhar says Goa is different as one lease cannot be more than 100 hectare whereas in rest of India a lease can be a maximum of 10 square km. In Karnataka the complaints include working outside the mining lease, in the forest area and boundary dispute. “In Goa, not a single area is mined outside the lease.” Handling of the dump, he adds, has been construed by people as working outside the lease area. “Handling of the dump is different from removing the ore. In mining lease it is removing the ore, in dump it is rehandling, it is a different question whether rehandling is right or wrong… the difference is no illegal mining is taking place per se,” he explains. Another distinguishing feature is the low grade of iron ore found in Goa and it could only be exported and not a single steel mill is equipped to handle it.

But more could be in store as the CEC has indicated that its next report would focus on four issues — punitive action against the officials, public functionaries and others, compensation payable by the defaulting lease holders and others, cancellation of the mining leases which are found to be involved in substantial illegal mining and other serious illegalities and any other aspects of the illegal mining issue. The CEC strongly recommended recovery of the amount of illegally exported iron ore from the mine owners. “How much extraction is the need of the State has never been quantified, only parameter for extraction of iron ore in Goa for last nearly 60 years is unlimited greed of the private sector miners,” says Goa People’s Forum Advocate Satish Sonak.

On the loss of jobs and loss of livelihood argument, he argues that mining was never a people-centric business. He says that a myth was created that if mining was stopped, it would be a big catastrophe. The business by trucks and others is a pure investment-oriented business. Mr. Sonak argues that it is time Goa considered nationalisation of mines, which Mr. Fonesca also feels could be panacea of ills. It is the only State where mining is in private sector entirely“I am not supporting the private companies. I am saying that mining should start with all checks and balances. I am not saying all mines owners are rogues, there could have been excesses… but you cannot throw the baby with the bath tub. Left to myself, I believe that mining should be nationalised. Since I am a part of the front, I have to go with the common demand, mining should start bereft of illegalities,” he says.

With the Supreme Court expected to hear the case later this month, some clarity may emerge. Until then, the security guard has little but to while away his time and wait for his colleague to join him for the evening shift everyday.

ravikumar.n@thehindu.co.in and prakashkamatgoa@gmail.com

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