The protagonists of the script, the Reddy brothers, used muscle and money to grease their way through government departments. Initially, it was all gold. Heads have rolled, and the political establishment of Karnataka has been shaken up. The biggest losers have been the environment and the people living in the area.
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The protagonists of the script, the Reddy brothers, used muscle and money to grease their way through government departments. Initially, it was all gold. Heads have rolled, and the political establishment of Karnataka has been shaken up. The biggest losers have been the environment and the people living in the area. How Bellary was laid waste.
The all-powerful iron ore mining mafia of Karnataka has hurled red dust into the eyes of democratic India with impunity, and for long. Between April and July the state lost Rs 16, crore due to illegal mining. When Karnataka Lokayukta Justice N Santosh Hegde submitted his 25,page final report to governor H R Bharadwaj on July 27, it revealed the colossal plunder of public wealth by those in power.
The report gives, with evidence, a detailed account of corruption, collusion and illegalities committed right from the ground level. The report of the watchdog against corruption forced chief minister B S Yeddyurappa to resign, causing much embarrassment to the ruling Bharatiya Janata Party.
The names of more than mining officials and companies engaged in mining, iron ore trade and steel manufacture figure in the report.
The frenzy to extract iron ore started in And with it began the saga of unholy collusion between the political class and the mining and steel industries. Joining hands, they gifted new leases and renewed the defunct ones. Large-scale mining led to massive environmental destruction. In March , the Karnataka government asked the Lokayukta to probe allegations of illegal mining. But investigating a mining lobby with immense money and muscle power was no mean task.
The minister in-charge of Bellary district was Janardhan Reddy, the mining baron himself. Almost all officials in the forest, revenue and police departments were handpicked by the Reddy brothers. U V Singh, chief conservator of forests who led the investigation, was physically attacked.
The report gives a detailed account of the irregularities committed in granting mining leases, mining, stacking, transporting, trading and exporting the iron ore.
But there was no system to identify the illicit consignments. According to the Karnataka Forest Act, , no forest produce can be transported by rail or sea without valid permits. It devotes an entire chapter to describe the illegalities committed by the Associated Mining Company, in which Janardhan and his family have a stake. Those who refused were denied permits to transport ore. The report also clearly states involvement of public sector companies.
This was perhaps to help private players make big money. So did Mysore Minerals Ltd, a Karnataka government firm with 40 mining leases. Hegde has listed names of officials involved and their bribery rates at the Belekeri Port. It cites instances when the board avoided mandatory public hearings or conducted public hearings without involving villagers for granting new mining licences. During peak mining period when air and water bodies were increasingly getting polluted, the board turned a blind eye.
Action awaited For Hegde, the mission is accomplished. His term ended five days after he submitted the report. But he is not sure if the state government will take action. In December , Hegde had submitted a page report which warned that the deposits would not last more than 20 to 30 years even under moderate rate of mining.
It recommended a ban on all trades of iron ore, including export. The report said the mineral should be reserved only for domestic consumption.
It also pointed out that the rate of royalty, between Rs 16 and Rs 27 per tonne, was absurdly low. It recommended action against many for contravening the law, including former chief minister N Dharam Singh, who held the portfolio of the department of mines and geology. But no action was taken except filing of a few criminal cases against companies.
Operations of 16 companies were suspended but they managed to get a stay from the state high court and resumed mining. In December , a special task force of the Indian Bureau of Mines ordered suspension of operations in 12 mines for violating mining plans.
Similar orders were passed against 18 companies in April But exports went on unabated. But the miners are incorrigible. A day after the apex court banned mining activities in Bellary for three months, Fomento Mines Company was caught transporting 3, tonnes of ore worth Rs 75 lakh by rail. Is this an indication to what the future holds? Picture imperfect. About two years ago people of this taluka, located in Bellary district, demolished their mud houses.
They dug up the earth and collected huge amounts of iron ore dust. Selling it to traders fetched them handsome amounts. Papinayakanahalli now has freshly built concrete houses. Its people also have tippers and earth movers that help them mine the rest of the land. There are odd trucks in the village now.
Its people cashed in on the sudden surge in the price of iron in the global market. Hospet witnessed frenzied digging. Lands were leased to traders. Illegal mining was the order of the day, and night.
Trucks overloaded with iron ore jammed roads, even as women and children waited on crossroads holding containers and broomsticks to collect the dust that flew off open trucks.
But the bubble has burst. On April 29, the Supreme Court cancelled mining activities of 19 companies based on a report by the Central Empowered Committee.
On July 29, it ordered ban on all mining activities in the environmentally ravaged Hospet, Sandur and Bellary talukas in Bellary district. A cloud of uncertainty now hovers.
But this poor district was also blessed with rich iron ore reserve. As per estimates in , Bellary had close to 1, million tonnes of the mineral. The district had witnessed mining for decades. But large-scale extraction began only in the second half of the s. This could be because iron then was not a prized commodity. A truckload of iron ore cost just Rs 1,, less than the cost of sand. Now, it has reached Rs 7, per tonne.
Sorghum, finger millet, green gram and pulses were also cultivated in this once picturesque land, he says. This rainfed region had dense forests, grasslands and streams. Mining was not the main profession in Hospet either. This dry region is partially irrigated by waters from the Tungabhadra dam. Sona masuri, a quality rice variety, and sugarcane, apart from other crops in the unirrigated lands, are grown here.
As the mining sector opened to private companies, China began importing huge quantities of iron ore to prepare for the Olympic Games. It developed a technology that required iron dust—high grade ore sized 6-mm and below—for steel production. The price of iron ore soared. From Rs 1, per tonne in it crossed Rs 5, per tonne in The massive loot began.
It was around this time that Gali Janardhan Reddy entered the scene. Poor at studies, he started a hotel which did not work. His tabloid venture failed. He incurred losses worth crores of rupees in a chit fund company.
Janardhan campaigned for Sushma. She lost but Janardhan gained as he managed to attain political clout. He entered the iron ore industry a few years later.
He bought a mine in Obulapuram village in Andhra Pradesh. The village shares its border with Bellary. Soon, Janardhan was encroaching upon 11 mines on the Karnataka side of the border. Over the period, Janardhan had gained money, muscle and political power. So powerful was he that he could even alter the inter-state border. Almost all mine owners, including Anil Lad, succumbed to his pressure tactics. Those who did not had to suffer losses. A few like D Ramesh, a mechanical engineer and son of former Congress MP from Anantapur district in Andhra Pradesh, adamant not to make any contract with Janardhan, could never start operations.
Ganesh was physically assaulted. The Tapal family, which had completely lost its mine to Janardhan, is livid. Why should we yield to the Reddys? Janardhan himself became the minister-in-charge of Bellary district.
Karnataka government sends second report to CEC on illegal mining
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CEC for ban on mining in Karnataka for 10 years
New Delhi: A Supreme Court-appointed committee has recommended a severe crackdown on illegal mining in Karnataka, including cancellation of mining leases. The Central Empowered Committee CEC also indicted the Karnataka government after it found complicity by administration officials in the rampant illegal mining that has also caused ecological damage in the Bellary-Sandur-Hospet region of Karnataka. The page report was submitted by CEC to the apex court on Friday. The report claimed that the decade-old problem of illegal mining of iron ore and manganese would probably exhaust mineral reserves in the region within 20 years.
CEC indicts Karnataka for illegal mining
How Bellary was laid waste