People's Democracy

MMRD Bill 2011

Pushing in Private Sector,

Pushing out Tribals

Brinda Karat

THE 20th Party Congress of the CPI(M) had adopted a resolution calling upon the government to recognise the rights of tribals in mineral wealth through appropriate legal mechanisms. It is well known for example that much of the iron ore and bauxite deposits required for production of steel and aluminium respectively, are in areas inhabited by tribal communities and in Fifth Schedule areas. Many corporates have amassed their wealth through the exploitation of minerals in these areas which have been gifted to them by successive governments.  Yet, the tribal communities living in the same areas are amongst the poorest in the country. The majority of the major mining districts are counted in the 150 most backward districts in the country. But the legal mechanism proposed by the central government, namely the Mines and Minerals (Development and Regulation) Bill 2011 (MMDRA), is designed to promote not the interests of deprived communities but those of private mining companies, foreign and domestic.  The Bill is presently before the parliamentary standing committee.

FROM PUBLIC

TO PRIVATE

In India, ownership of minerals lies with the State. However, the central government which has control over all major minerals like iron ore, bauxite, copper, coal and most state governments which have control over minor minerals like sand, stone, granite, etc have promoted privatisation through leasing mines to private companies apart from handing over captive mines of iron ore and bauxite to steel and aluminium corporates like Tatas and Birlas. Although at present the public sector accounts for the major production of minerals, according to a recent report compiled for the industry by Ernst and Young, of the 4.9 lakh hectares of land given out in mining leases in 23 states by the end of 2009, 95 per cent of the leases comprising 70 per cent of the land earmarked was given out to private companies. During 2008, India’s mining industry attracted more FDI investment than it had in the last twenty years, of 458.3 million dollars.

The MMRD Bill in the main is to further push the deregulation and liberalisation of the mining sector and encourage privatisation based on the recommendations of the Hoda Committee. It is estimated that much of India’s mineral wealth is still unexplored.  Globally there is an interest in the discovery of new areas of mineral wealth reflected in an increase in exploration budgets of mining companies by 40 per cent to around 11 billion dollars. Many of the provisions of the Bill are designed to attract this investment. It introduces the concept of high technology reconnaissance, prospecting and exploration licenses, and easy terms of conversion to mining leases to encourage the entry of FDI and foreign companies. It also gives weightage, in the allocation of leases, to criteria which favour such companies and also allows them activity on much larger tracts of land than previously. This means that not only for mining, but also in the process of exploration huge tracts of land and those living on them will be taken over by these companies. The Bill promotes the private sector in all mining industries including coal. Even mining for atomic materials which was reserved for the public sector is proposed to be opened up.

IN THE NAME

OF TRIBALS

There are some  provisions in the Bill which claim to address the rights of tribal communities. There is a provision (Sec 43) that makes it mandatory for coal mining companies to give funds   amounting to 26 per cent of the profits. For other major minerals, an annual amount, which is the equivalent of the royalty paid in the financial year, must be given. These funds are to be deposited to a district mineral foundation which is to be manned largely by bureaucrats and mine owners with a nominal representation of local communities. The foundation will decide how the funds are to be used. Interestingly, the US which had set up somewhat similar trusts to manage funds paid by companies using the land on reserves owned by Native Indians has recently had to pay compensation of 1.2 billion dollars to 41 Native American communities for “mismanagement of the assets” of the trust and is expected to have to pay another 3.4 billion dollars in another similar case. When the affected people do not have a decisive say in the management of such funds, as in the case of the proposed district mineral foundation, this “mismanagement” is inevitable.

The very premise of the scheme replicates the patron-client relationship, which has so degraded tribal communities into recipients of charity, instead of recognition as owners of the land and its resources. To add insult to injury, the provision has a specific clause which gives the right to a Mining Regulatory Authority to revise the payments of percentage of profit by coal companies to be made into the Fund. Thus as privatisation of the coal industry sector increases, the percentage may also be brought down for which a specific legal provision has been made.

ATTACK ON CONSTITUTIONAL

AND LEGAL RIGHTS

The other related provisions of the Bill constitute an outright assault on the constitutional rights given to tribal communities, in particular in Fifth Schedule areas. The Bill gives legal sanction to the arbitrary rights of the governments both at the centre and states to give different types of licenses and leases from reconnaissance to exploration, prospecting and finally extraction without any procedure for even consulting, leave alone taking the consent of tribal communities. The only reference (Sec 13.13) to “consultation” (but not consent), is for the grant of licenses for minor minerals (but not major) in Fifth and Sixth Schedule areas where “the gram sabha or the district council, as the case may be, shall be consulted.” Thus even the provisions under other laws such as the Panchayat Extension (to Schedule Areas) Act (PESAA), which mandates consultation with the gram sabhas are violated by the exclusion in the Bill, of any consultation process before giving leases for major minerals, which are the main sites of tribal deprivation. In another provision (Sec 13.5) for notification of giving leases in forest areas and wild life areas, the state government has to “take all necessary permissions from the owners of the land and those having occupation rights.” An unwarranted differentiation is made between the rights of tribal communities in Fifth Schedule non-forest areas and forest areas. However, even in the case of forest areas, there is no provision for what would happen in case the owner does not give permission.

In Fifth Schedule areas, the law prohibits transfer of tribal held land to non-tribals. Different states have also enacted such laws like 70/1 in Andhra Pradesh, the Chotanagpur Tenancy Act and the Santhal Parganas Tenancy Act in Jharkhand. None of the mining companies who get leases are owned by adivasis. Presumably this was the reason why in the Samta case the Supreme Court held that sale, transfers and even leases of tribal land to non-tribals are illegal. It had directed that governments should consider a mechanism to include cooperative societies of tribal communities for mining operations. The Samta judgement has been ignored in the Bill. Tribal cooperatives have been disqualified in the list of those eligible to get a lease for mining of major minerals which can only be companies registered under the relevant laws (Clause. 5.1) It is only for minor minerals and small deposits in Fifth and Sixth Schedule areas that the state government “may” (not “shall”) consider tribal cooperatives for getting the lease (Clause 7). An earlier draft of the Bill in 2010 had included a provision for a guaranteed stake of tribal communities in mining companies. The provision had said “the company “will allot free shares equal to 26 per cent through the promoters quota.” South African law under the Broadbased Black Economic Empowerment Act has a provision of mandatory sale of 26 per cent shares in all mining companies to “historically socially disadvantaged sections.” In India however, after the strong protest of mining lobbies, this provision has been removed and substituted with a provision for a token allotment of   “one share per member of the affected family.”(Clause. 43.3)

WHERE ARE

THE JOBS?

There are other issues such as compensation and compensatory jobs in lieu of lost livelihood which are inadequate and also ambiguous and under bureaucratic control. With the huge reduction of the work force in the mining sector by around 30 per cent between 1991 and 2004, and the conversion of permanent jobs into contractual and casual work, the promise of employment to land losers cannot be taken at its face value. Other issues of compensation such as for lands affected by exploration  are also left to the mercy of bureaucrats. As far as minor minerals are concerned state governments are to decide. Tribal communities in states like Jharkhand, Rajasthan, Maharashtra who have been affected by stone and sand quarrying have suffered at the hands of state governments who have not ensured any compensation. This regime will continue, with legal sanction.

OPPOSE

THE BILL

Seen together with the pending Land Acquisition Bill which specifically excludes the issue of leasing of tribal land from its purview, this Bill not only buries the ownership rights of tribal communities but opens a gateway for the easy entry of international and domestic corporates and private entities to Fifth Schedule and tribal dominated mineral rich areas to plunder the natural resources of our country. India, which is a signatory to many of the international conventions of the UN on the protection of tribal rights, is violating these conventions and adding to the burden of historical injustice. The Bill, in its present form should and must be opposed and resisted.