INSIGHT Hills in the north-east corner of AP AnRak Aluminium bordering Odisha. Another Vedanta in the Making? The AnRak Project A number of memoranda of understand- ing (MOUs) to set up alumina plants were Patrik Oskarsson signed by the erstwhile Y S Raja sekhara Reddy (YSR) government between 2005 A bauxite/aluminium project very auxite mining in the tribal areas and 2009. Under these MOUs, the AP similar to the Vedanta project in of central India has become one government would, together with private Odisha is coming up in Bof the most controversial issues in companies, extract and refi ne bauxite the country and has faced signifi cant op- ore. However, while the proposed Jindal Visakhapatnam district of Andhra position locally as well as nationally, the South West (JSW) and Nalco projects Pradesh. AnRak Aluminium, a most notorious in recent years being have hit roadblocks, AAL has secured all company of the government of the Vedanta Aluminium Limited (VAL) clearances for its refi nery and smelter Ras al-Khaimah of the United project at Lanjigarh in Odisha. A number complex. Construction is now in progress of similar struggles have been witnessed at the site in Makavarapalem in Visakha- Arab Emirates and Penna Cement in other areas as well including Kashipur patnam district though the construction of AP has secured approval for in south Odisha and the agency areas of roads and other infrastructure for the both an aluminium complex and of Visakhapatnam in Andhra Pradesh mines remains incomplete due to signi- AP the bauxite mines, but the fi nal ( ). Though the Fifth Schedule of the fi cant local opposition. Indian Constitution provides protection In February 2007, a MOU was signed forest clearance for the mines is to the adivasi (tribal) people living in between the AP government and the awaited. The AnRak project has scheduled areas, also known as agency government of Ras al-Khaimah (RAK), a replicated the Vedanta model of areas, across nine states from alienation member of the United Arab Emirates, for fi rst building the refi nery and of their lands and natural resources to mining and refi ning bauxite under which non-tribals, one sees that rather than the AP government promised to supply then setting up the mine. The upholding the adivasi people’s rights to bauxite via the AP Mineral Development mine is to be operated by the state land and resources, government is col- Corporation (APMDC), a public sector government to circumvent the luding with private investors to usurp entity owned by the AP government, to ban on non-tribal landownership. these rights. the alumina refi nery to be established At present, the National Aluminium by AAL. APMDC would mine the bauxite In fact, the state government Company (Nalco), a public sector under- in the Jerrela Hills of Visakhapatnam has disregarded the huge taking (PSU), is the only company per- district, a scheduled area, and supply it environmental and social impact mitted to mine bauxite in southern to AAL’s refi nery, which would be built and popular protests against Odisha, which it has been doing since outside the reserved tribal area. This the early 1980s. However, VAL has not peculiar set-up was apparently employed mining bauxite in the Jerrela given up hope of mining bauxite in the to circumvent the tribal land transfer Hills, inhabited almost exclusively Narayangiri Hills near Lanjigarh, and legislation that bans private ownership by adivasi tribes who will further south in AP, AnRak Aluminium of land in the scheduled areas in AP.1 AAL AP be displaced, to safeguard Ltd ( ) has made signifi cant efforts The government did not make any to gain access to bauxite deposits in announcement about the signing of this private gain. the state. MOU. It was only a month later that an This article questions why AAL is being Andhra daily published a news report allowed to become another Vedanta by about the venture. At that time little was following the controversial approach of known about RAK, which was chosen as splitting bauxite mining and alumina an investment partner over other inter- refi ning in two parts. Like the experience ested companies such as public sector of the Dongria Kondh adivasis in the Nalco. Indeed, RAK did not have an offi ce Niyamgiri Hills in Odisha where VAL or a website at the time; its registered had made exaggerated claims, AAL too offi ce was a family house in the Jubilee Patrik Oskarsson ([email protected]) is is silent about the fate of the Kondh Hills area of Hyderabad. The choice of Assistant Professor at the Azim Premji and other adivasi communities living RAK as a business partner was unexpected University, Bangalore. in the proposed mining area of Jerrela given that it had no previous industrial Economic & Political Weekly EPW december 29, 2012 vol xlviI no 52 29 INSIGHT experience, not to mention any expertise of Rs 7,000 crore on 1,380 acres of land. The main criteria for the selection of a in aluminium. It does have a ceramic Even though the Environmental Impact site next to Makavarapalem appears to tiles business in AP and as a small, rich Assessment (EIA) report made it clear that be that it was outside the scheduled area, kingdom in west Asia, it has money the company intended to double output had a canal next to it to provide water and oil that could be used to produce in the future, there was always some and crucially, consisted largely of the aluminium. Indeed, many west Asian amount of uncertainty about its plans so-called assigned land, which has come countries such as Dubai, Oman and Qatar (Ministry of Environment and Forests to be so popular for industrial projects are currently either expanding or invest- 2008b; BS Envi Tech 2008). AAL now in AP due to its weaker protection of ing in new aluminium smelters fuelled reports that it has 1,926 acres of land tenants.6 Also, following common practice by cheap access to natural gas and oil, available (AnRak Aluminium Ltd 2012b) in AP and following Vedanta’s example and the RAK project is likely to fi t into a where signifi cant construction work is at Lanjigarh, it was decided to acquire plan of exporting alumina to a smelter in currently underway. It is unclear when agricultural land but to circumvent the west Asia in the future. the complex will be completed; however, villages (Oskarsson 2010; Amnesty Inter- In 2007, there were rumours about the company’s website says production national 2011). A visit to the site in June the involvement of the locally infl uential would commence in June 2012, which 2012 made it clear that the villages Penna Cement group in the deal but this has already passed. If news reports are remain within metres of the proposed could not be substantiated (Oskarsson correct, it appears that the AAL manage- site and its polluting activities. Living 2010). In 2012, however, this connection ment is worried about where it will next to a polluting industry without any is clearly evident on the AAL website which get its ore from since enquiries are being job appears to be what the AAL EIA refers says, “AnRak Aluminium Ltd commenced made about getting supplies from Gujarat to as land acquisition with “minimum as a joint venture between Penna group or central India (Patnaik 2012). It is relocation” (BS Envi Tech 2008: 149). of industries and Ras Al Khaimah Invest- interesting to note that even as AAL is Little is known about the actual land ment Authority with 70:30 ratio” (AnRak moving ahead to fi nish constructing its use before AAL moved in. According to Aluminium Ltd 2012a). A local leader plant, Vedanta’s Lanjigarh refi nery has the AAL EIA, “[s]ugarcane was the most opposed to the project at Makavarapalem suspended operations as it does not extensively grown crop with coverage described the AAL management as being have suffi cient ore.5 Is this the future of of about 66% of the cropped area. […] mainly the Penna group with little oper- AAL as well? Paddy was the second prominent crop ational infl uence exercised by RAK.2 But covering about 21% of the cropped area” if the Penna group is the main promoter, Land Acquisition (ibid: 77). An MoEF inspection team the question is why is the company Unlike VAL, AAL was able to avoid a public further reported that “most of this area called AnRak rather than AnPenna? hearing prior to land acquisition. This is was under casuarina plantation. Remain- Is this because there is an attempt to one mandatory point of information ing area was under paddy, sugarcane, camoufl age the close links between the sharing and public debate that has, despite mango, chilies, etc. Only about 200 acres promoters and the YSR regime that could its many defi ciencies, remained some- were under irrigated cultivation” (Ministry have hampered the deal? The Penna what of a stumbling block for projects in of Environment and Forests 2010: 36). Cement group was founded by P Pratap AP. In AAL’s case, however, the AP govern- According to these sources, though the Reddy, treasurer of AP Congress during ment found an innovative way to circum- site was cultivated, it was perhaps not of the YSR years, and described as a close vent the process. By notifying the area the best agricultural quality. associate.3 With other AP Congress mem- for the AAL complex as a special eco- Another concern for local residents bers also believed to be investing in the nomic zone (SEZ), it was possible for the and Visakhapatnam city residents is the project, it is not surprising that the government to acquire the land without 38 million litres of water per day that has project has been accorded extremely a public hearing and thus also without an been allocated to AAL from the contro- high priority, enabling it to catch up with EIA report, which would have given some versial Polavaram project (GVMC 2008).