Tehelka Magazine, Vol 7, Issue 13, Dated April 03, 2010
‘Mining Lease Is Used
As James Bond’s Gun’
Santosh Hegde, 70, Lokayukta of
Karnataka, probably has the most vexing
job in the state, pointing out wrongdoings
and hoping they’ll be corrected. His report
on illegal mining in the state was the most
damning in recent times on the subject. A
second part of the report is due in a few
weeks. In this interview with VIJAY SIMHA,
Hegde, who was a judge of the Supreme
Court for six years, lays bare the outrageous
loot of state resources by a few and
how it is devastating a people. Excerpts:
|NO EASY OUT Hegde says there is
no point in nationalising mining
Photo: SB SATISH
Mining in Bellary appears to be a nasty
business. How did the loot begin?
Around 2005 and 2006, the mining boom
led to intense competition and conflicts
between the two main groups, the Obalapuram
family and the Baldotas. Political
pressure was used. Plenty of money
flowed into politics. Bellary grew, and the
Obalapuram family [the Reddys] had by
then entered politics, joining the
Bharatiya Janata Party (BJP), which had no foothold there. They supported Sushma
Swaraj in the polls, against Sonia Gandhi.
They managed to continue with political
support, especially from a former [Congress]
Chief Minister of Andhra Pradesh
(AP) with whom they had a nexus. Mining
was lucrative and everybody in Karnataka
and Obalapuram in Andhra, became active.
When a lot of money starts coming,
you try to find the quickest way — most
often illegal — to earn more than others.
But mining is tightly regulated.
The Indian Bureau of Mines controls mining.
You can excavate only so much from
a particular mine head. You cannot go
beyond six metres in depth. There should
be a minimum distance between each
mine head, otherwise they collapse. There
are areas prone to landslides — you are
not supposed to mine there. Some time
ago, the Supreme Court had said that
non-forest activity should not take place
in forest area. It appointed a Centrally
Empowered Committee (CEC), whose
permission was needed to do anything
that degraded the forest. So, the mining
companies found it difficult to stick to the
law and did what they wanted to do.
How weak are government officials?
The Reddys started doing other illegal
things because the CEC did not have local
people supervising, neither here nor in AP.
The easiest people to buy are those in government
service. The officers were from
the departments of mines and minerals,
forests, transport, police. Obviously, they
were all available for a price. The price was
a pittance compared to the earnings.
Amid all this, there is the curious case
of a government firm showing losses
during the gold rush. How come?
The Mysore Minerals Ltd (MML), which is
wholly owned by the state, had very good
iron ore available, running into thousands
of kilometres. But they were not mining.
Even in this mad rush, they were very cool
about it. They granted sub-leases to somebody
else. At their guesthouses in Sandur, Hospet and Bengaluru, these lease holders
made merry. This was the only company
that, between 2002 and 2008, ran a loss of
about Rs 600 to Rs 700 crore. They had
given it to third parties for a pittance. I
mention this specifically for those who say
we must nationalise mining. That is no
answer at all. It’s like moving from the
devil to the deep sea. Unless the human
being is honest, nothing can happen.
Much distortion occurs during excavation.
Could you detail what you saw?
What is excavated is contrary to the
standards laid down by the Indian Bureau
of Mines. There is nobody to supervise.
Officers of the mines and
minerals department were happy to stay
in office-cum- residences because the
share of the loot used to come to them
there. Some time ago, the government
got a royalty of Rs 27 on the best quality
iron ore, which is called 65 Fe. The same
metric tonne of iron ore, taken out on a
royalty of Rs 27, was being exported in 2006-2007 at Rs 6,000 to Rs 7,000. Thousands
of crores were lost.
Is this limited to the Reddy brothers?
It was not confined to the Reddys. It was
there for every person who was mining.
The number of leases given out was about
158. But mining was going on in more
than 250 places. Nobody stopped it.
It would seem that everybody is guilty.
There is the looting of mineral, the environmental
problem, the human problem,
damage to the roads and loss to the
state. I indicted many officers for giving
leases without authority, checks and
control. Leases are given on revenue
land. The same lease is used as James
Bond’s gun to kill anybody — anytime
and anywhere. Not only is mining done
in the forest area, it is also used as a
dump. Trees are cut to make roads. It’s
like rape, reap and run. After I went
there and spoke to people, they started
burning these vehicles because they
were not getting anything. But, they are
bought over by promises of a lakh or two
as village development funds.
Is the government response lacking?
We constantly released information to
see if it could activate the government
into doing something. It never worked.
You can understand from this how
powerful the mining group has become.
UV Singh, one of our most efficient
officers, found in the Obalapuram border
area that there was trespassing from
Andhra into Karnataka, and that a large
area of Karnataka was being mined on
lease given by the Andhra authorities.
There was a temple at the border that
was blasted out. I recommended that the
Centre get a joint survey done to preserve
Karnataka’s border integrity. They
never pursued it. You know the modus
operandi — you complain, an inquiry
commission is appointed. You ask them
to do something, a letter is sent with no
follow-up. Even today, nothing has been
done. When two companies — the
Reddys and the Modis — fight over
boundaries, the Supreme Court asks for their boundaries to be preserved. When
the state asks for it, nothing is done.
Do systemic loopholes make it even
There is evidence to show empty lorries
coming into Karnataka, filling up
material, going back on an Andhra permit
— as if the minerals were mined
there — and transporting it via Karnataka
to various ports. I wanted check
posts put up and every empty vehicle’s
number noted. If it returned loaded, we
could seize the vehicle, using the Mines
and Minerals Act. But there is also the
so-called compound offence that can be
collected from a mining company. You
collect Rs 1,000 for material worth Rs 1
lakh to Rs 1.5 lakh and let the vehicle go.
An entire state became paralysed?
It is because the mining families have
become so politically powerful today.
They are capable of manipulating the
government. Remember the controversy
over chief ministership in Karnataka
some months ago? A deal was finally
struck in Delhi. Officers transferred outside
were brought back to Bellary. My
understanding is that they have given
Bellary to them [the Reddy family].
Will raising officers’ pay stop this?
There is no need to increase the pay of
officers — it has trebled since 2008. They
have gotten used to the bribes. If the government
wants to do it, we can prevent
all this. Iron ore export should be banned.
Why send a non-renewable commodity
to another country, whatever the price? If
you stop exports and encourage people to
have mills as close to the mines as
possible, the Central Government will get
thousands of crores a day as excise. State
governments will get hundreds of crores
as VAT. It gives employment to people
whose land has been mined. One factory
will do for the whole of Bellary. It will
employ 40,000 to 50,000 people. Tell me
one good reason why you want to export,
when it is not worth it economically,
ecologically, and environmentally — and
when it is not people-friendly.
The Hell Diggers
THE SCALE OF CORRUPTION IN MINING IS A NATIONAL CALAMITY. NO ONE EPITOMISES THIS BETTER THAN THE BELLARY BROTHERS. KIDNAPPINGS, POLITICAL CLOUT, MUSCLE POWER. VIJAY SIMHA HAS THE WHOLE STORY. PHOTOGRAPHS BY SHAILENDRA PANDEY
‘Mining Lease Is Used As James Bond’s Gun’
Santosh Hegde, 70, Lokayukta of Karnataka, probably has the most vexing job in the state, pointing out wrongdoings and hoping they’ll be corrected. His report on illegal mining in the state was the most damning in recent times on the subject. A second part of the report is due in a few weeks. In this interview with VIJAY SIMHA, Hegde, who was a judge of the Supreme Court for six years, lays bare the outrageous loot of state resources by a few and how it is devastating a people. Excerpts: