The Great Odisha Mining Loot

The State Government has been on the overdrive since the Shah Commission gave its report on Goa mining. During the last couple of months the state mining department has issued circulars, policy guidelines, closure notices, made IT interventions and has formed a GOM etc. Continuing with these efforts to hoodwink the Shah Commission the State Government suddenly realized that it owes 57,904 thousand Crore from mine owners for the last ten years, which is almost equal to the annual budgeted expenditure of the State Government.

But, is the revenue loss to the state Government only 57,904 thousand Crore, which is the amount admitted by the State Government till date. The revenue loss will actually be more than 250 thousand Crore and this estimate is not presumptive. The sudden rise in demand for iron ore a decade back, both in the international and domestic market, created a gap between demand and supply. The State Government failed to appreciate the trend and by acts of omission and commission allowed the huge revenue loss through three sources. Firstly, the lease-holders, who are legal entities, were allowed by the State Government to produce iron ore beyond the approved mining plan. Secondly, the non-operational mines were allowed to be looted by a mining mafia, basically thieves with mining equipment. Thirdly, areas which are not covered by any mining lease were mined by criminals and sold through a network of traders and middlemen. There was no enforcement of laws and the state Government facilitated the loot. The 57,904 thousand Crore demanded from lease holders may go up once all the over-production is accounted for. But, what about the revenue loss due to mining in non-operational and in non-lease areas, which is a pure theft?

When the magnitude of the loot became apparent as a responsible opposition party we raised an alarm. I even demanded a C.B.I. probe. Instead of ordering a C.B.I. investigation the state Government decided to use the state vigilance to deflect attention from their own acts of omission and commission by trying to entangle leaders of the Congress Party with the loot of Odisha’s resources. I have always said that any act of wrong doing by any mine-owner, related to me or not, must be dealt firmly in accordance with the law. Where then is the scope of any innuendo, insinuation or doubt? Law must take its own course, so why fear the C.B.I.? Who is the Government trying to protect by not ordering a C.B.I. investigation? Let me make it very clear, once and and for all, at the cost of repetition for the n^th time that I want all violations to be dealt firmly and in accordance with the law.

The State Government also constituted well-publicised task forces to improve enforcement and went on vehemently denying that irregularities happened. But, now the skeletons are crumbling out of the closet and the state Government is admitting all the irregularities we had been pointing out by issuing circulars to stop the same irregularities, but only after seeing the Shah Commission’s report on Goa. The current attempt is to prove that they have neither any nexus with the mining mafia that looted the non-operational and non-leased areas nor with mining lease holders. They want to preempt the Shah Commission report and hope that when the matter is eventually investigated by the C.B.I.  the State Government can admit to omissions by some lower level Government officials who can be made easy scapegoats, deny acts of commission and evade criminal liability. They first tried to blame it on Indian Bureau of Mines for violation of mining plan. But, ultimately they have realized that the buck stops at the door steps of the State Government. They also realize that no investigation can show that the Congress tried to protect any wrong doing. In fact, BJD was in power and how can they blame the Congress if laws were not enforced and loots happened in broad daylight. If we were in power, we would be held guilty. What about the BJD and its Mr. Clean Chief Minister? What was he doing during all these loots?

I had been personally demanding the state Government in my capacity as the leader of the main opposition party in the state to strengthen the enforcement mechanism to stop mining of non-operational mines and areas not yet leased. The crusher machines used to convert stolen ore should not have been allowed to come up in the first place. They should not have also allowed a network of traders. Those buying ore could have sourced it from mine-owners. Stopping the transport of the stolen minerals could have been another way of preventing the theft. Who allowed all these nefarious activities and who has benefited from them? What made the Government go slow on enforcement? Why did they keep denying the irregularities and why are they now issuing circulars, policy guidelines after the great loot is over and the horse has bolted? The role of the State Government would amount to acts of omission if the loot was unknown, either in terms of modus operandai or in terms of volume. But, when everything is known and yet such broad daylight loot is allowed how can they be mere acts of omission? The State Government’s attempt to obfuscate issues despite my demand from the beginning for a thorough investigation and various insinuations are deplorable and attempts to hoodwink the public. Naveen Patnaik must answer for all his misdeeds.

One of the ways to bridge the gap between demand and supply would have been to strengthen the State-owned Odisha Mining Corporation (OMC). But, by acts of omission and commission, the OMC operated only 6 of the 38 mines for which it holds lease. Had Odisha Mining Corporation been properly managed, it could have contributed nearly ten thousand Crore every year as profit to the state exchequer, which could have been spent in the social sector while reducing the gap between demand and supply that benefited  private mine owners and the mining mafia. Why did the state Government ask OMC to under-produce while demand for iron ore was soaring? Is this not good enough evidence of a clear nexus between the State Government and illegal mining? Where do Congress leaders come in the picture? Did we ask the Government to mismanage the OMC or not to strengthen the enforcement mechanism? Did we ask the Government not to order a C.B.I. investigation like it is happening in Goa, Karnataka and Andhra Pradesh? Is it not true that the mining loot in Odisha, in terms of volume, is higher than Goa or Karnataka? Have we not been demanding the OMC to play a greater role?

Also, the State Government should have been pro-active in clearing proposals for extension of mining lease by legal entities. Instead the applications were kept pending or delayed to extort maximum pound of flesh in bribes to clear the applications and for blackmail. Such situation exists in no other state. A transparent Government will always clear applications in a time bound manner rather than allow rampant corruption. The mining plans of lawful mines should also have been revised with the approval of Government of India to reduce the demand-supply gap. The State Government did not take any proactive steps for revision of the mining plans. They should have cancelled the lease of non-operational mines, which could have been leased out following a transparent and competitive bidding process. Till 10-15 years back mining was not as profitable a business and the volumes were low. But, now with increasing demand we should have done much better in value addition creating jobs and we should have been more methodical in allowing scientific mining within limits imposed by the very non-renewable nature of this scarce resource and of course environmental impact. All the Mega Projects for value additions remain as misconceived MOUs; un-implemented or un-implementable. And of course, the Government should have used the revenue earned from mining to strengthen the enforcement mechanism. Instead, acts of omission and commission by the state Government has led to a real revenue loss of nearly 250 thousand Crore and Odisha continues to be the poorest state in India. Now the stolen ore has crossed the seven seas and built modern infrastructure in China. What we need is a multi-agency probe by not only the C.B.I., but also the Income Tax and the Enforcement Directorate? I have my doubts that the Government can get back any significant amount from the 57,904 thousand Crore that they are now claiming from lease holders as the entire process may enter into a prolonged process of litigation and arbitration. As regards the mining mafia, there is not even an address to send a notice.

In the last 12 years the Chief Minister has perfected a few stock answers, mainly adjectives, like ‘false’ and ‘baseless’ etc. He will say that law will take its own course, but will continue to oppose a C.B.I. investigation. This is the true story of the Great Odisha Mining Loot.