Month: August 2019

Reply given by one Australian Customer about the false news published by a selected paid news reporters

Collusion Of Officials With Beach Sand Miners Revealed In Internal Report

 

The spin on this internal Indian Bureau of Mines (IBM) report is interesting. Nowhere does the internal IBM report suggest collusion by any of its employees. This allegation is made in this report by ’EAS Sharma, retired bureaucrat who is a keen environmentalist’ (last page para 6). There is no other explanation as to who Mr. Sharma is nor to his expertise in these matters and his comments come with no context. Hence his opinion proves nothing and is an unfounded allegation only.

Therefore the headline of this report is misleading and incorrect.

On the 2nd March 2015 in response to unstarred question N0, 1086 in the Indian Lok Sabha the then Minister of State for Steel and Mines answered a question specifically related to illegal mining, its definition and the application of the relevant Act and regulation across India by the Indian Bureau of Mines (IBM) and which explained the procedures adhered to by the IBM for monitoring of mining across India. It specifically states:

‘At the start of mining activity a tentative scheme of mining is conceptualized based upon preliminary information on geology and reserves. Laying the limits for annual production for the entire life span of a mine, which is generally 20 – 30 years, at the time of approval of mining plan, is not practicable for the following reasons:’ Three reasons are then provided.

As per the IBM internal report it was normal up until the Shah report was released in August 2015, for retrospective approvals to be granted and hence not illegal. Finally one further important point made in this parliamentary report:

‘IBM has been allowing deviation up to 20% of the tentative annual production indicated in the approved mining plan/scheme of mining’.

These statements go to the very heart of this second report by Sandhya Ravishankar (SR) for they do provide an explanation for the actions by the IBM employees which were applied across all India and largely negate the thrust and allegations of this second report. Hence my detailed responses to S. Ravishankar’s second report are as follows:

 

Section headed ‘What does IBM have to do with Beach Sand Mining’.

  • Page 2 para 4: There are two errors in this paragraph. Firstly a margin of 20% was automatically allowed but of more relevance is that the Mines and Minerals (Development and Regulations) Act 1957, does NOT stipulate a quantity of mineral to be mined. Each mining lease makes a provisional estimate and then this is adjusted once mined tonnages are known and the reasoning for this is given in the Minister’s reply in the Indian Parliament and referred to above – Lok Sabha, Unstarred question No. 1086, 2nd March 2015.

 

  • Page 2 paras 6 & 7: These two paragraphs unwittingly encapsulate the confusion that became apparent in the mining approvals process between January 2007 and July 2016. IBM could approve the mining plans for garnet and sillimanite alone until July 2016 and up until January 2007 the Department of Atomic Energy (DAE) was responsible for rutile, zircon, ilmenite, leucoxene and monazite. However in January 2007 when the DAE delisted rutile, zircon, ilmenite and leucoxene from the Atomic Minerals prescribed substances list, they claim that from that date they had no responsibility for the issuing of approvals for the mining of these minerals and hence the responsibility rested with the IBM. However the required corresponding change to the Mineral Concession Development Rules 1988 (MCDR) also delisting the four minerals WAS NOT MADE (Reply affidavit to Amicus Curiae report filed by the second respondent (Dept. of Atomic Energy), dated 25th September 2017) so IBM also stated that without this change in the MCDR they were also not responsible for the mining approvals for these four minerals. Hence both the IBM and the DAE said that they had no responsibility for these minerals from January 2007. Hence possibly incompetence and a fight between these two Government departments may well be the reasons behind the poor application of the two Acts/Regulations. Certainly the industry was confused and anecdotally relate stories of paperwork being held in limbo as the two departments denied responsibility.

 

  • Page 2 para 8: SR fails to advise that the Mineral Concession Development Rules she comments upon from February this year have been the subject of a stay order in the Andra Pradesh High Court and hence at this time private participants are still allowed to mine mineral sands (excepting monazite). This important point should not be overlooked (High Court of Andhra Pradesh, 15th March 2019, Justices Kumar and Murthy, Writ Petition no. 3335, 2019). This should not have been left out as the reasoning behind the stay order was a lack of fairness which may make the ruling unconstitutional and which is an important judgement related to this report.

 

Section headed ‘What triggered the Inquiry’.

  • Page 2 paras 9: SR makes the statement that ‘The trigger for the inquiry was the role played by their own officials in helping the illegal mining and transportation of beach sand minerals…’ and attributes this finding to the Amicus Curiae (AC). Once again the statement needs to be made that the findings of the AC are still being tested in court and are NOT FACT and have been rejected by the IBM in their report. The same findings by the AC against employees of the Department of Atomic Energy (DAE) were also strongly refuted in the DAE’s reply affidavit to the AC’s submission and dated the 25th September 2017. The DAE state (Page 4 point 4):

 

‘At the outset, it is submitted that all allegations made against the second respondent (DAE) as contained in the status report are denied as false and vague and deserves to be dismissed in limine’.

 

  • Page 2 para 10: As per my previous statement there is no fixed production quantity under the MMDR Act and allowances were made by the IBM across all mining for the reasons given in the answer provided in the Lok Sabha on the 2nd March 2015.

 

  • Page 2 para 11: The IBM in their internal report stated that ‘The approval of Mining Plan without site inspection was mainly because the mines were not operational ‘(page 77 point 7).

 

  • Page 3 para 1: The issue of 50% recoveries (which the AC deems impossible) is frankly wrong and again is addressed by the Dept. of Atomic Energy in their response to the AC, dated the 25th September 2017. On page 10 Point 12, second para the DAE states:

‘In view of the above, higher grades in the mining areas compared to AMD exploration reports are possible in some cases. Hence the allegations of influencing officials of AMD are not borne out of facts’.

Secondly in the most recent addition of the IBM Indian Minerals Yearbook 2018, 57th Edition, Ilmenite and Rutile, page 15-5, 5th paragraph makes the following statement:

‘In dry mining, beach washings laden with 40 – 70% Heavy Minerals (HM) are collected through front-end loaders and bulldozers for further concentration….’

Further during the drilling and exploration work we undertook between 2001 – 2004, it was not uncommon for grades of mineral to be well in excess of 50% and in several cases we found areas where the heavy mineral content (beach sands) were in excess of 90%. These three points once again show the AC’s lack of knowledge of the industry and again this illustrates why it is not reasonable nor fair of SR to make statements based upon the untested allegations made by the AC.

  • Page 3 paras 2-4: Certainly the IBM admits in its report that there were lapses on the part of several officers to work within the full range of their powers but, as noted by SR (page 1 para 6), the report states clearly that the lapses were not intentional and ‘are due to the practices in vogue at that time’ (IBM report point 7, page 77). However these practices were applied by the IBM across ALL mining in India (Lok Sabha answer dated 2nd March 2015) and not just mineral sands and hence do not support any claims of ‘collusion’ as alleged in this report.

 

  • Page 3 paras 5 – 7: Clearly there is confusion here between the royalty paid (3% of sale price as ad valorem basis – Bedi report page 561) and sale price. SR here states two different values being the

 

‘sale price of garnet was Rs 377 per MT for Tamil Nadu’ (para 5) but then states ‘while a mere Rs 377 per MT was being collected as royalty’ (para 8). Hence this is yet another incorrect statement.

 

Further, claims that this was ‘causing years of loss to the state exchequer’ is clearly not economically sound as no sane business would sell garnet domestically at Rs 377/tonne when they were achieving between ‘Rs 15,000 to 18,000’ as the actual export price. Hence any argument that the exchequer would be losing revenue is not rational for all miners would have been exporting at the higher price and paying the 3% royalty rate which was beneficial to the exchequer.

 

Section headed ‘Who are these officials & what did they do’.

Regarding the 14 cases examined the opening statement by SR given below is completely unsubstantiated. She states:

‘Let us look at some of the cases where officials turned the other way or even actively colluded with private miners to allow illegal mining of beach sand minerals to continue’.

This statement is designed to lead into the case studies and yet no proof of collusion is provided beyond this opinion. To state at the top of each box ‘Illegality’ describing activities that were approved by the IBM and then proceed to make an assumption that these approved activities were illegal and indicate collusion between the IBM employees and the mining companies, are not supported by fact. Clearly the matter is far more complex than these statements indicate and once again show that there is a narrative being followed in this article rather than an investigation supported by facts. Hence SR’s strident claims of illegality and collusion do not hold up to scrutiny.

As explained previously there are no limits provided for in the MMDR Act nor in the MCDR which restricts production and as advised in both the internal IBM report AND the response to a question in the Lok Sabha, the retrospective granting of licences and production was standard procedure for the IBM across India.

In response to the final paragraphs of this second report (pages 9 & 10) the following comments can be made:

  • Page 9 paras 1 – 7: The IBM report does explain in some detail the reason for the lapses it found in the application of the rules associated with mining in the 64 leases examined. However as explained before this is a complex matter made worse by the lack of clarity as to which department was actually responsible for oversight from January 2007. However at no time does the IBM report ever draw the conclusion that there was collusion between the mining companies and the employees of the IBM. Further (para 7,) as far as I can determine, the issue of allowing for replenishable reserves in mining areas not on the beach only occurred in one instance and it was a lease held by Indian Garnet Sand Company who was found to be illegally mining without the correct licences in 2007. At no time did the IBM report state that ‘The one lapse admitted to by the IBM is that of hiking the replenishment reserves in mining plans in a bid to help the miners mine more’.

 

  • Page 10 para 6: It is in this paragraph that the opinion of EAS Sharma is given but as previously stated, his opinion, presented without context, authentication or proof of any collusion from reputable sources, is irrelevant.

 

  • Page 10 para 10: S. Ravishankar’s final point regarding the time of reckoning is a critical point for not only will the various Government departments noted face this reckoning but so will the Amicus, the Bedi report and the Sahoo report be subject to the same scrutiny.

 

In summary:

  • There are several factual errors in this second report and once again a lack of knowledge of the industry is shown.

 

  • Once again the article relies upon one report and does not take into responses from other participants in the matter such as the DAE and their response to the AC’s report to the High Court or the actions of the Andhra Pradesh High Court.

 

  • Important facts relevant to the matter such as the method of operation common to the IBM and its employees are left out.

 

  • Erroneous statements and headings are used which attribute findings of collusion to the IBM report when no such finding was made by the said report.

 

  • The use of third party opinions stating collusion with no context, explanation or proof is misleading.

 

  • Inflammatory statements are made with no proof or substance behind the allegations.

 

  • Continued reliance upon reports from the AC which have not been tested in court again expose this report to the criticism previously expressed that this second report is one sided and lacks accuracy.