Monday, May 7, 2007

Down To Earth Editorial: What China is doing to Goa

Here is an interesting article or analysis by CEO of India's leading environmental development organization called Center for Science and Environment (CSE) located in New Delhi.

Editorial: What China is doing to Goa


By Sunita Narain

I wrote last fortnight about how mining in Goa for iron ore was ripping
its forests and devastating its people. I wrote of the violence and
protests I saw in its villages, where miners were pitted against people
angry at the loss of their cultivable lands and their water bodies. I
had asked then: what are we doing? I ask this again.

The fact is that Chinese demand for iron ore has increased its price
from US $14 per tonne to US $60. This has spurred a black gold
rush-mining companies are bidding for areas that were either closed or
not opened because they were unprofitable or unviable. In many cases,
these mines had not been worked because they were close to villages and
companies knew that people would probably protest. Now none of this
matters. The industry says this is boom time-the Chinese are willing to
buy low-grade ore, which Goa has aplenty. The Chinese want this ore, as
they will blend it with better quality ore. And their appetite is massive.

Goan industrialists are not asking questions. They are desperate for
windfall profits. In January 2007, China imported roughly 36 million
tonnes of iron ore, of which India supplied nearly 7 million tonnes. But
more importantly, India's exports to China were up 18 per cent-with Goa
at the head of the supply line. In the past six years, Goa's mineral
exports have increased 35 per cent to 23 million tonnes last year.

But what is clear is that this Chinese connection is costing Goa big
time. While mining companies are making record profits, as evident from
their stock prices or balance sheets, the villagers in whose backyards
the mines are being dug are devastated. According to official estimates,
roughly 430 leases for mines have been granted in the state. History is
important as most of these were concessions granted by the Portuguese
and were converted into leases by independent India. But importantly, in
1998, only 99 leases were being worked. Now with the black rush, the
leases, which were dormant, furiously opened and worked.

It is important to understand what this means for villages. If all the
leases are worked, then over 8.5 per cent of Goa's land area would be
under mines. Surely, industry argues, that is a small price to pay. But
this is an erroneous calculation. The fact is that mining is
concentrated in some villages-their entire land will be swallowed up by
mines. An application filed under the Right to Information Act reveals
that in these villages large areas have been listed as leases-in Colomba
village, for instance, almost 1,500 ha of land may be mined, out of the
village's 1,900 odd ha. This is the case in village after village,
where, as I wrote last fortnight, I saw land and livelihoods being
destroyed. And I saw angry people and tense miners.

The boom has other costs as well. These minerals are moved across the
state in barges and in trucks, over village roads and rivers. Here also
people lose, and the environment suffers. In Rivona village I visited,
people had blocked miner's trucks. They were furious because the truck
moved through their village road, leading to pollution and congestion.
The children could not cross the local road anymore, villagers said. The
red dust the vehicles threw up covered their fields, they added. Roughly
33 million tonnes of minerals transited through the state last year-as
Karnataka also sends its minerals through this state. That would mean
that 3.3 million trips were made-over 7,000 trucks each day travelled on
the roads meant for people. Just imagine what this will do to people's
daily lives.

But why are we cribbing, you may ask? Surely, the regulatory
processes-environment impact assessments (EIAs) and the mandatory forest
clearances should take care of these concerns. The problem is that while
public hearings-to listen to local people-are mandatory under EIA rules,
actually heeding what people say is not. Therefore, even when people
have rejected mines in public hearings, the Union ministry of
environment and forests in Delhi has cleared them.

Then, in Goa, large areas of forests are not classified in government
records. These are private forests or community lands, so forest
clearance is not necessary to cut them down. So what if local watersheds
disappear, taking with them the sources of water for villagers?

Industry has its own ways of 'persuading' local people. Everywhere I
went, I heard tales of corruption and nepotism. The best tool seemed to
be for local leaders-often panchayat heads-to first take people's
concern to the miners and then use this opposition to get lucrative
contracts. The best going deal is in transportation. In all this, the
local politician has been reduced to nothing more than a middleman-a
pimp for the miners to milk.

It is clear that the stakes are high. Today, even if we assume prices of
iron ore at US $50 per tonne, mining companies in Goa would have made a
neat US $1.15 billion last year-roughly Rs 5,175 crore. All the miners
pay to the state is royalty, calculated on each tonne mined. Even if we
assume the highest rate of royalty, the state government would have
earned US $5 million-Rs 24 crore or just peanuts if we compare to the
loot that private companies are raking in. Clearly, there is no public
benefit in this business. Only costs.

But this cannot go on. This development is piggy-backing the poor and
their environment. People will not take it. I believe Goa will have to
decide. It can sell itself cheap on the Chinese market. Or it can
restrain its mining to certain areas, make profits and share the
benefits with its people. This is a make or break situation. Let us be
clear about it.

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