People's Democracy

(Weekly Organ of the Communist Party of India (Marxist)


No. 35

August 29, 2010



Subhas Ray


ON August 16, both the houses were adjourned as soon as they met. Parliament came to a standstill over the firing on protesting Aligarh farmers when anti-BSP outfits sought to corner the Mayawati regime over land acquisition for Yamuna Expressway. BSP members strongly protested against this attempt to raise a state subject in parliament. However, illegal mining issue dominated the week in both houses.


On August 17, Lok Sabha passed the Essential Commodities (Amendment) Bill 2010. From the CPI(M) side, M B Rajesh welcomed it, saying its objective was to clearly define the fair and remunerative price (FRP) and clarify the ambiguity created by an earlier ordinance. The term “FRP” was misleading because the prices offered were neither fair nor remunerative, not providing any incentive to farmers. That is why the area under cultivation has come down. So while fixing the FRP, the government should consider the concerned crop’s cost of production, especially of inputs, which has increased substantially. We also need to find some effective mechanism to benefit the consumers. The member demanded a still more comprehensive amendment to the Essential Commodities Act, which is an important weapon in the hands of state governments to fight black marketing and hoarding. Also, more items should be included in its purview.




Both the houses had a discussion on the large scale illegal mining in various states. Initiating the debate in Rajya Sabha, CPI(M) leader Sitaram Yechury said  what is happening is a gigantic loot of resources of our country. We require an out of the box solution to protect our country’s mineral resources. The court had appointed a Central Empowered Committee (CEC) to go into this issue, particularly in Andhra Pradesh and Karnataka. The CEC advised to take immediate steps to stop the mining operations, including transportation of already mined materials from the six mines dealt with in the CEC report. But nothing happened. After that, 71 lakh tonnes has been exported illegally. A report of Lokayukta of Karnataka said that his office conducted raids and seized 99 trucks with illegally mined ores and 40 sacks of forged documents. On the basis of these, 8.5 lakh tonnes of ores were purchased by 11 companies for export; six lakh tonnes were shipped out even when the High Court was considering the matter. The point is that the whole affair is being treated with a lack of seriousness even though all arms of our set-up --- the judiciary, the executive and the legislative assemblies of concerned states --- are concerned with the matter. The question is that: Can we afford this sort of a loot of our country’s resources?  The question of who is responsible for it, needs to be addressed and the guilty brought to book. 


It has also been estimated that 1.6 lakh hectares of forestland were diverted for mining and 77 million tonnes of water used up in one single year, 2005-06. This would have met the daily needs of nearly three million people who do not have potable water near their habitations.


Further, collateral damages go far beyond the economy. The riches from illegal mining are influencing our political system. Every single area suffering from Maoist violence today it is an area rich in minerals, particularly coal. Thus the issue permeates every single sphere of our democracy. To stop illegal mining and protect modern India, there is no other way but to nationalise our mineral resources and ban their export, Yechury emphasised. 


In Lok Sabha, Basudeb Acharia described illegal mining as a big scam involving lakhs of crores of rupees. He said the government of India announced a National Mineral Policy in 2008; before it we had the National Mineral Policy 1993 just after the adoption of the policy of liberalisation. In 1996, the government allowed FDI to the extent of 50 per cent; subsequently, in 2006, FDI to the extent of 100 per cent was allowed. Then, many multi­nationals and other companies started mining in five or six states which have abundant deposits of iron-ore. Its export increased from 12 million tonnes in 2003-04 to 128 million tonnes in 2009-10.  In 2009-10, total iron-ore production in our country was 217 million tonnes. Out of it, 128 million tonnes were exported though the internal consumption was 85 million tonnes only.


As for illegal mining, it is going on for two decades, increasing every year, and the central government cannot shirk its responsibility because it alone gives the approval for mining. The expenditure we incur for import of steel is more than double the amount we earn for iron-ore export. Why cannot we utilise our iron-ore which is the finest in the world? Our projection of steel needed at the end of the 11th Plan is 117 million tonnes but we are producing only 65 million tonnes today. The money involved in illegal mining is lakhs of crores of rupees, but the royalty the government receives is a pittance. There are five ports through which iron ore is being illegally exported, but what the shipping ministry is doing? Without paying any royalty the iron ore is being exported. 


The members also said the condition of workers in these mines is horrible. Most of them are suffering from serious occupational diseases. No labour laws are being followed there.


Concluding, Acharia demanded a CBI enquiry to probe the entire gamut of this corruption. Unless the government nationalises the mines, it will not be able to curb the illegal mining.


Saidul Haque, CPI(M), pointing to the gradual growth of illegal mining in the country. An official report said during 2009 the state governments detected 58,294 cases of illegal mining in an area of 82,67,469 hectares and Rs 105.06 crore were collected as fine. The Bureau of Mines has constituted a Special Task Force for conducting inspections. It conducted only two rounds of inspections but found numerous violations in 78 mines and suspended the operations there. In spite of that, illegal mining is growing. The Maoists are resorting to extortions in the mining areas. The member demanded that the centre, in consultation with the state governments, should come forward to prevent a nexus between the Naxalites, forest contractors, transporters and illegal mining operators. The role of the Central Industrial Security Force (CISF) should also be looked into as, in some cases, its personnel were seen helping the illegal operators for money. 




Rajya Sabha passed the Mines and Minerals (Development and Regulation) Amendment Bill 2008 on August 17. During the discussion, the CPI(M)’s Tapan Kumar Sen opposed the bill, questioning the very concept of offering coal blocks to the private sector. Coal is a precious natural resource and should be used in the best interest of the country by a public sector entity.  Coal India must be the nodal agency to handle this precious resource, ensuring statutory supply to vital sectors like power, fertilisers, steel, cement, etc. The track-record of the coal blocks handled by the private sector shows that this precious natural resource is not safe in private hands. Out of 228 coal blocks offered to the private sector for captive use, more than 200 still remain inoperative. The allocation has been utilised for speculative purposes to make quick money. Nor is a switchover to auction not going to change the situation because we don’t have the mechanism to discipline them. Coal mines were nationalised in 1972-73 but the process of denationalisation started after 1993. It has led to losses of our natural resources. It is a utopia to expect the private sector, an expert in illegal mining, to take care of our national and social requirements; it is.


Sen also referred to another paradox. While virgin coal blacks are being offered for private exploitation, the public sector navratna company, Coal India, is being made to rush for acquiring coal blocks in Australia. The reason being given is that we would get good quality coal. This is humbug.


There is one crucial recommendation of the standing committee that, to save our forests, environment and local population, coal blocks in the reserved forests and protected forests should not be allotted. This clause should have been incorporated in the bill. Despite another specific recommendation of the standing committee, the bill contains nothing regarding the rehabilitation and resettlement of the people who will be dislocated by handover of coal blocks to private exploitation. The bill also specifies that government companies would not be included in the auction process. It is a discrimination against the public sector. From 2003 to 2010, only 34 blocks were allotted to the PSUs and 130 to private players. This means institutionalising a mechanism to promote corporate interests at the cost of public sector companies. The workers are the worst sufferers because the competitive bidding would lead to cuts in wages, social security and their living conditions. Thus the mining areas are going to be the hotbed of extremist politics, Sen warned.




Rajya Sabha has passed the Energy Conservation (Amendment) Bill 2010. Supporting the bill, the CPI(M)’s T K Rangarajan said the economic development of a country is closely linked to energy consumption. While in total energy consumption we lag much behind the USA, Japan, etc, data indicate energy wastage in various sectors of the economy. Substantial amounts of energy is wasted not only due to deficient technology but also because of energy complacency of high energy consumers. Even in the power-starved areas, there is vulgar consumption of energy by the rich for marriages, social and religious functions etc, while 40 per cent of Indian population are crying for energy. In this situation, the volume of electricity consumed in IPL like events is a cruel joke. The member asked: How much energy has been saved by the textile, cement and pulp industries, by the railways, by chemical industries involving electrolysis, distillation, evaporation etc? In Port Trusts, there are all types of power generating stations, based on coal, gas, diesel etc. But how many of these have been covered by the bill? Not many.  Then, what is the use of this bill? The member said there is huge scope for energy conservation in the country and referred to how a group of 120 trained women volunteers in Kerala propagate among the people as to how to save energy. Energy saving in Kerala has got international recognition and in 2008 the UN decided to extend the model to other nations. He also demanded mandatory audit of the energy balance sheet of all industries and commercial establishments along with their financial balance sheet, with the provision of incentives and penalties.




In Rajya Sabha, Sitaram Yechury asked the government to come out clean as to how a cabinet minister could openly collaborate with the Maoists, protect and patronise them. He said the prime minister had, at least on three occasions, said Maoist violence is the gravest danger to India’s internal security. However, Ms Mamata Banerjee dubbed a person killed in an encounter as a “shaheed.”


Brinda Karat, CPI(M), raised the issue of “paid news” in Rajya Sabha. She said while the media are making excellent use of the right to information to expose wrong-doings, it is shocking to learn that the Press Council of India is suppressing vital information on the ‘paid news’ scandal.  The Press Council had set up a two-member subcommittee to look into the scandal and it produced a 72-page report. Instead of making the report public, however, the effort is to remove the names mentioned. It is essential for the government to intervene in this matter. 


Moinul Hassan drew attention of the Rajya Sabha to the severe drought prevailing in Eastern India because of deficit rainfall. The government of West Bengal has declared eleven districts as drought hit. Entire Bihar and Jharkhand have been declared drought hit. In West Bengal, cultivation is not possible on lakhs of hectares of land. There is the need to increase the work under NREGA manifold. But fund constraint is there. Rs 1400 crore are required as labour cost  to face the drought situation in West Bengal. In his letter to the prime minister, the chief minister demanded immediate release of the balance amount to save the common people and to provide jobs to the common people of West Bengal.


K N Balagopal forcefully demanded allocation of more foodgrains, sugar and other food items to Kerala. The state government is subsidising these things for the Onam and Ramzan festivals.  Besides supplying the cheapest rice in India, Kerala also provides 14 items at subsidised rates. He demanded that the centre must reintroduce the earlier quota of 1,13,000 tonnes, and also give the state 50 per cent of the subsidy.


Tapan Sen took up the issue of takeover of major oilfields by Vendanta-Cairns. He said Vendanta has been proactive in clinching the deal with Cairn Energy for taking over 51 per cent stake of Cairn India, thereby establishing its control over a number of oilfields in the country.  The government, the ministry of petroleum and the ONGC are silent in this respect. It is notable that the ONGC is a 30 per cent stakeholder in the assets of the Mangala oilfield. Sen asked whether this stoic silence is for allowing the share prices to zoom high in the markets. In this respect, the government must intervene immediately. No takeover of control of Mangala oilfield in Rajasthan should be allowed in the interest of the country’s energy security, he insisted.