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SUSTAINABLE DEVELOPMENT: Emerging Issues in India's Mineral SUSTAINABLE DEVELOPMENT Emerging Issues in India’s Mineral Sector Sponsored by Planning Commission Government of India May 2012 Institute for Studies in Industrial Development 4, Institutional Area, Vasant Kunj, New Delhi SUSTAINABLE DEVELOPMENT: Emerging Issues in India’s Mineral Sector A research study sponsored by Planning Commission Research Director Shri Nilmadhab Mohanty Research Associate Aarushi Goyal Institute for Studies in Industrial Development 4, Institutional Area, Vasant Kunj, New Delhi - 110 070 Phone: +91 11 2676 4600 / 2689 1111; Fax: +91 11 2612 2448 E-mail: <[email protected]> Website: <http://isid.org.in> CONTENTS Abbreviations v-ix Preface & Acknowledgements xi-xii Executive Summary xiii-xx Introduction 1–4 Section I SUSTAINABLE DEVELOPMENT AND MINERAL PRODUCTION 5–34 Chapter 1: Why Sustainable Development Today? Chapter 2: Sustainable Development: Concepts, Principles and Applications Chapter 3: Sustainability and Mineral Cycle Section II INDIAN MINING INDUSTRY: BREIF PROFILE AND REGULATORY REGIME 35–82 Chapter 4: Indian Mining Industry: A Brief Profile Chapter 5: Legal Regime and Role of Government Chapter 6: Environmental Policy and Laws for Mining Sector Section III EXPERIENCE IN SUSTAINAIBILITY PRACTICES IN INDIAN MINERALS SECTOR: A FEW CASE STUDIES 83–154 Chapter 7: Odisha Chapter 8: Goa Chapter 9: Karnataka Chapter 10: Jharkand Section IV INTERNATIONAL EXPERIENCE IN SUSTAINABILITY PRACTICES IN MINING: SELECTED CASES 155–176 Chapter 11: Sustainability Practices in Canada, Australia, South Africa and Papua New Guinea Chapter 12: International Initiatives and Sustainability Practices of some multinational mining companies i Section V CONCERNS AND CONCLUSIONS 177–216 Chapter 13: Governance Failure: A major concern Chapter 14: Industry Behaviour and other concerns Chapter 15: Elements of Sustainable Development Framework for Mining Chapter 16: Conclusions and Recommendations Annexures 217–256 References 257–274 List of Tables 1.1: Taxonomy of sustainable development goals 3.1: Opportunities for Local Area Development 4.1: Value of Mineral Production (2008-09 to 2010-11) 4.2: Index of Mineral Production 2004-05 to 2010-11 (excluding atomic minerals)(Base 1993-94 =100) 4.3: Contribution of the Mineral Sector to GDP at factor cost (current prices) 4.4: Percentage share of major minerals in India’s exports 4.5: Percentage share of major minerals in India’s imports 4.7: Number of Operating Mines in 2009-10 and 2010-11 4.8: Number of Reporting Mines in various states, 2010-11 (excluding atomic and minor minerals) 4.9: Distribution of mining leases in India (March 2011) (By area groups) 4.10: Distribution of mining leases between public and private sector enterprises in India (March 2011) 4.11: Top thirty producers of minerals in terms of value of production in India (2010-11) 5.1: Number of illegal mining cases detected by State Governments 7.1: Mineral Resources of Odisha (as on 1st April 2005) 7.2: Mineral Production in Odisha 7.3: Total mineral resources of Keonjhar district 7.4: Changes in land use in the Joda Block (Keonjhar) 7.5: Distribution of mining leases (iron ore, manganese ore and chrome ore) in Keonjhar district by land sizes in 2010 8.1: Mineral resources and remaining reserves in Goa (as on 1st April 2005) 8.2: Mineral Production in Goa 8.3: Production of Iron Ore in Goa ii 8.4: Share of different sectors in Net State Domestic Product of Goa at factor cost at current prices (Base: 1999-2000) 8.5: Export of Iron ore from Goa 8.6: Iron ore exports through top five major ports of India during 2008-09 and 2009-10 8.7: Mining and Quarrying related Employment for Goa (2008-09) 9.1: Mineral Resources of Karnataka (as on 1st April 2005) 9.2: Mineral Production in Karnataka 9.3: Distribution of iron ore mines in Bellary district by land size 10.1: Mineral Resources of Jharkhand (as on 1st April 2005) 10.2: Mineral Production in Jharkhand 12.1: Ten principles of ICMM 12.2: Dimensions of sustainability performance of multi-national mining companies 13.1: State and Central Agencies involved in Major Regulatory Provisions for Mining in India List of Figures 1.1: Environmental Consequences of an iron ore mine 4.1: Trend in Index of mineral production (Base 1993-94 = 100) 4.2: Trend in value of mineral production 4.3: Trend in value of minerals by groups 4.4: World Free Market Price Indices of Mineral Ores and Metals, 2000-2010 (Base: 2000=100) 4.5: World Free Market Commodity Prices (annual) of iron ore (Brazilian ore to Europe, Vale Itabira SSF, 64.5% Fe content) 4.6: Indices of wholesale prices of minerals and iron ore in India 4.7: Share of States in Value of Mineral Production 2010-11 5.1: Legislative Framework of the Mining Industry 7.1: Contribution of mining and quarrying to net state domestic product (Base: 1999-2000) List of Boxes 7.1: Pictures Showing Scientific Mining 7.2: Pictures Showing Unscientific Mining 7.3: Rehabilitation of waste dumps through vegetation 7.4: Pictures Showing In-house nursery 7.5: Afforestation 7.6: Medical Camps iii 8.1: Dump slopes stabilized with geo-textile and mixed herbs and grasses 8.2: Reclamation of mined out land at Sesa Goa’s Sanquelin mine 8.3: Social Development Activities 9.1: Dust suppression with fine spray on mine haul roads & Washing of asphalted roads 10.1: A few rural development activities undertaken in Lohardaga district of Jharkand List of Annexures 1 India: Estimated Resources of Major Mineral Commodities (2005) 2 Contribution and Rank of India in World Production of Principal Minerals and Metals 3 Value of Production of Selected Minerals in India 4 Quantity of Production of Selected Minerals in India 5 Contributions of Principal Minerals to the Mineral Sector’s GVA (Gross Value Added) (Share of GDP) at current prices 6 Mineral Exports during selected years 7 Mineral Imports during selected years 8 World Free Market Price Indices of Mineral Ores and Metals, 2000-2010 (Base 2000 =100) 9 World Free Market Commodity Prices (annual) of iron ore (Brazilian ore to Europe, Vale Itabira SSF, 64.5% Fe content) 10 Indices of wholesale prices of minerals and iron ore in India (Base 1993-94 = 100) 11 India: Structure of the Mineral Industry in 2009 12 An outline of the provisions of the Draft Mines and Minerals (Development and Regulation) (MMDR) Bill 2011 13 List of Mines Visited During Field Study 14 Summary of legislative provisions and procedures for sustainable mineral development in Canada, Australia, South Africa and Papua New Guinea (PNG) 15 A Note on International Experience in Benefit-Sharing of Mineral Resources Revenue 16 A note on Rio Tinto in India (Bunder, Madhya Pradesh) iv ABBREVIATIONS ABG African Barrick Gold ABR Aboriginal Benefit Reserve ANZMEC Australian and New Zealand Minerals Energy Council API Assessment on Proponent Information BALCO Bharat Aluminum Company Limited BAP Biodiversity Action Plan BEE Black Economic Empowerment BHJ Banded Hematite Jasper BPD Business Partnership for Development CBO Corporate Business Obligation CCL Central Coal Fields Ltd. CEAA Canadian Environment Assessment Act CEC Central Empowered Committee CEPA Canadian Environment Protection Act CIL Coal India Ltd. CMPDI Central Mine Planning and Design Institute Ltd. CMR Coal Mines Regulations CPCB Central Pollution Control Board CRMS Community Relations Management System CSE Centre for Science and Environment CSR Corporate Social Responsibility CTE Consent to Establish CTO Consent to Operate DGMS Director General of Mines Safety DMF District Mineral Fund DSM Dutch State Mines e3 Environmental Excellence in Exploration EAC Environment Assessment Committee EIA Environmental Impact Assessment EIR Extractive Industries Review EITI Extractive Industries Transparency Initiative EMP Environment Management Plan EPA Environment Protection Act v EPBC Environment Protection and Biodiversity Conservation EPR Environment Protection Rules ESP Electrostatic Precipitator FCA Forest Conservation Act FDI Foreign Direct Investment Fe Iron FIMI Federation of Indian Mineral Industries FIPB Foreign Investment Promotion Board FRA Forest Rights Act GDP Gross Domestic Product GMI Global Mining Initiative GOI Government of India GPS Global Positioning System GRI Global Reporting Initiative GSI Geological Survey of India GVA Gross Value Added Ha Hectares HCL Hindustan Copper Ltd. HDSA Historically Disadvantaged South Africans HEMM Heavy Earth Moving Machinery HINDALCO Hindustan Aluminum Company HTREL High-Technology Reconnaissance-cum-Exploration License IBA Impact Benefits Agreement IBM Indian Bureau of Mines ICME International Council on Mining and the Environment ICMM International Council of Mining and Metals IDP Integrated Development Plan IIED International Institute for Environment and Development IPR Industrial Policy Resolution IRR Implementing Rules and Regulations ISO International Organization for Standardization IT Information Technology JPOI Johannesburg Plan of Implementation Km Kilometer vi LAPL Large Area Prospecting License Mg Milligrams M3 Cubic meter MALCO Madras Aluminum Company Ltd MBR Maternity Benefits (Mines) Rules MCA Minerals Council of Australia MCCM Mines Control and Conservation of Minerals MCDR Mineral Conservation and Development Rules MCR Mineral Concession Rules MDC Mining Development Contract MDF Mine Development Fund MFG Mineral Foundation of Goa Mm Millimeters MMDR Mines and Minerals Development and Regulation MMR Metalliferous Mines Regulations MMSD Minerals, Mining and Sustainable Development MNC Multi-National Corporation MOA Memorandum of Agreement
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