Indian Mining Law: A Critical Review (Part-II)

Having established that the guarantee of mineral tenure security is central to the current objectives of the Indian legal framework, it is significant that mineral tenure security can, conceptually, appear at odds with other normative goals of mineral laws, such as ensuring sustainability.[1] Bastida, for instance, writes of the ‘challenging task’ of guaranteeing security of mineral tenure in the face of ‘complications’ and ‘regulatory risks’ brought about by the requirements of sustainable development.[2] This article, on the other hand, argues that viewing mineral tenure security as entirely opposed to sustainability considerations is fallacious. This flawed perception has the implication that policy choices and implementation methods are unnecessarily seen as involving a trade-off between security of tenure, particularly in the broad sense of guaranteeing successful completion of all stages of the mining process,[3] and including stringent checks for environmental protection. It is further argued that such an understanding has possibly motivated one-sided reforms in the Indian mineral law, which have privileged business interests to the exclusion of sustainability concerns.

Guaranteeing a Social License to Operate- A Proposed Policy Objective

This article argues, instead, that the two objectives can be reconciled by invoking a concept recently introduced in literature on mining law- that of the ‘social license to operate’.[4]

This concept is rooted in the recognition that local communities are gradually emerging as vocal actors in the mining sector, voicing their concerns often through ‘disruptive’ methods including protests, blockades and media campaigns, leading to shutdowns and slowing down of mining projects across countries.[5] As a result, their ‘ongoing approval’ and ‘broad acceptance’ of the mining activities, which are termed as constituting the ‘social license to operate’, have become a vital factor without which mineral concession holders are exposed to ‘costly conflict’ and ‘exposure to social risks’.[6]

The relevance of this concept in the Indian scenario is evident in industry reports, which reflect concern that ‘over and above the [legal regulations]’, mining companies also have to ‘take the local community along’,[7] failing which they face the challenge of opposition from local communities- notable examples[8] in this regard being that faced by Vedanta’s bauxite mining project in Odisha,[9] the Utkal Alumina project,[10] and the Uranium Corporation of India’s projects in Meghalaya and Andhra Pradesh.[11] Further, the enactment of the Panchayats (Extension to the Scheduled Areas) Act, 1996[12] and the Supreme Court’s decision in Orissa Mining Corporation v Ministry of Environment and Forests,[13] have formalized the requirement of approval from the community, to the extent represented by the Gram Sabha, for mining projects-[14] making the social license to operate not just a pragmatic consideration but also a legal concept, to a limited degree.

Given the increasing frequency of social resistance to mining activities in various parts of India,[15] and noting also that many of these instances have been related to sustainability concerns,[16] it is argued that this peculiar ‘social risk’ must be sought to be given protection against through the legal regime for mining. That is, the conception of mineral tenure security in the Indian law must be expanded to include security against social resistance; conversely, it should aim to, as far as possible, carry an implicit guarantee of a social license to operate. Further, this article argues that the democratic and normatively approvable method of doing this would be to strengthen the sustainability framework in the law itself- with the result that compliance with the legal norms should be sufficient in giving investors a reasonable expectation that they will have a social license to operate.

It may therefore be concluded, drawing from this argument, that the incentive to strengthen the sustainability framework in mining law draws not only from environmental concerns simpliciter but also from the already embedded governmental priority to ensure mineral tenure security for attracting private investment.

Proposals for Strengthening the Mining Law for Sustainable and Efficient Land Use

Having established that provisions for mineral tenure security and sustainability in mining law are intrinsically connected, this article shall propose certain changes that may be brought into the mining law to enhance its ability to ensure sustainability. In particular, it shall focus on issues of post-mining land use.

It has been established that mining activities can lead to severe land degradation, biodiversity loss and livelihood displacement.[17] One of the methods adopted to mitigate this is the regulation of mine closure, to ensure that this is done in a manner that is in conformity with the requirements of sustainability.[18] To this end, for instance, the National Mineral Policy 2019 recognizes the need for ‘efficient and effective’ ‘scientific mine closure’, that will restore ecology and biodiversity.[19] Significantly, further, scientific mine closure that is in line with the socio-economic needs of the local community has also been found to be an important factor affecting the ‘social license to operate’.[20]

To this end, the legislative framework in India places several requirements upon a mine closure process. For one, the MMDR Act provides the Central and State Governments with the power to make rules regarding the rehabilitation of flora destroyed by mining activities,[21] and allows the former to issue directions to the latter for promoting ‘restoration and reclamation’ activities so as to optimally use mined out land for the benefit of the local community.[22] Additionally, the Mineral Conservation and Development Rules 2017 provide that no mine can be abandoned unless a Final Mine Closure Plan (FMCP) is approved by the competent authority,[23] and that such a plan must be submitted two years prior to the proposed closure of the mine.[24] Further, it provides that it is the mining lease holder’s liability to ensure that measures for reclamation and rehabilitation are carried out in accordance with the FMCP,[25] with the lessee being obligated to present a yearly report on the same to the Indian Bureau of Mines (IBM).[26]

Additionally, notifications under a set of legislations[27] specify procedures for post-mining reclamation of land in particular conditions. Judicial decisions have also provided for further reclamation measures, for instance in Common Cause v Union of India,[28] where the Supreme Court directed the Union Government to impose a condition for compulsory re-grassing of the mined area, in addition to conditions already imposed in the relevant mining closure plan.[29]

Noting the centrality of the FMCP to sustainable mine closure, this article shall review the latest legal guidelines for preparing the same,[30] to put forth an argument regarding the efficacy of these provisions and how they may be modified. These guidelines are prepared by the Indian Bureau of Mines (IBM), which is the body mandated with assessing FMCPs.[31]

The components required in an FMCP under these guidelines can be broadly grouped into three categories- first, management measures for solid and liquid waste, water bodies, and infrastructure and mining machinery present in the leased area at the time of submission of the plan;[32] secondly, safety measures and disaster management plans for the closure period;[33] thirdly, remedial measures to address the socio-economic repercussions of the mine closure.[34]

This article argues that these guidelines suffer from presenting the closure-related obligations of mining lease holders in silos, which prevents them from being required to develop an overall viable alternative proposal for land use post mine-closure. The need for the same, based on a cumulative analysis of the impacts of mining, has, in fact, been noted as essential for effective land reclamation.[35]

Also, the aforementioned guidelines, in being centred on ‘mitigative’ and ‘remedial’ measures to specific changes in aspects of the land such as top soil distribution and water quality,[36] appear to assume that post-mining land reclamation processes must necessarily be limited to the objective of bringing the land into the same use as prior to the mining process.[37] This understanding is also visible in studies conducted on the practices actually adopted by companies in the Indian mining sector.[38]

This approach, however, is vulnerable to criticisms from studies that have questioned the efficacy of policies driven towards restoring the pre-mining land use through the reclamation processes- for instance where ‘radical landscape changes’ have taken place, in which cases attempting to restore the prior land use pattern may be even more damaging to the environment.[39] Criticism also arises from propositions, such as those of Limpitlaw and Briel, that in such cases, it is more useful to use the degraded land for different, but productive purposes, such as infrastructure development that is not dependent on unattainable land features such as the quality of the soil that existed prior to the mining activity.[40]

On this basis, this article argues that the legal framework as it stands takes a narrow and overly uniform view of the heterogenous reclamation-related issues arising in individual mining regions, by-

First, wrongly assuming that ‘exact reclamation’[41] is possible in most cases;

Secondly, incentivising planning for remedial measures in a piecemeal manner; and

Thirdly, failing to incentivise more holistic land use change plans that are in conformity with the particular environmental, social and economic conditions of a particular leased area- which could, arguably, constitute an important part of the Corporate Social Responsibility (CSR) activities of companies if adequately incentivised.[42]

Hence, the IBM’s guidelines for FMCPs should, this article argues, be modified to require a comprehensive plan for alternative land use after the completion of mining, which is in conformity with the modified environmental conditions of the area. This shall, it is expected, serve to bring FMCPs in greater conformity with the legal requirement for ‘reclamation and rehabilitation’[43] of mined areas, where these terms are defined not necessarily in reference to the prior land use,[44] but in terms of the sustainable and efficient land use given the real, post-mining conditions of the land.[45]

Conclusion

Yet, while the concern of this article has been limited to the substance of the legal framework on mining, it must also be highlighted that many of the problems, particularly those concerned with sustainability of mining, arise from the improper implementation of existing provisions. Documentation of these range from noting rampant corruption in the enforcement authorities[46] and the lack of adequately meticulous assessment before the issuing of environmental clearances,[47] to highlighting that small mining lease holders, lacking financial soundness, often fail to even employ qualified professionals to design their mining plans or closure plans, apart from failing to fulfil many of the requirements of these plans.[48] It is submitted in conclusion, therefore, that both substantive and implementation-related changes must be made to the legal framework for mining in India- but that these must be informed by sound principles of guaranteeing mineral tenure security and sustainability, together.

  1. Bastida (n 43) 41.
  2. Ibid 42 43.
  3. Ibid 32.
  4. Jason Prno and D Scott Slocombe, ‘Exploring the Origins of ‘Social License to Operate in the Mining Sector: Perspectives from Governance and Sustainability Theories’ (2012) 37 Resources Policy 346.
  5. Ibid 346.
  6. Ibid.
  7. FICCI Mines and Minerals Division, Development of Indian Mining Industry: The Way Forward (October 2013) 23.
  8. Ibid.
  9. ‘Odisha Tribal Community Set to Block Vedanta Project’ (Firstpost, 30 July 2013) <https://www.firstpost.com/business/odisha-tribal-community-set-to-block-vedanta-project-995603.html> Accessed on 24 March 2022.
  10. Hrusikesh Mohanty and Dillip Satapathy, ‘Trouble Brews for Utkal Alumina Project as Locals Raise New Demands’ (Business Standard, 21 January 2013) <https://www.business-standard.com/article/companies/trouble-brews-for-utkal-alumina-project-as-locals-raise-new-demands-112121900159_1.html> Accessed on 24 March 2022.
  11. Lison Joseph, ‘Protests Hold up Uranium Mining Projects in Andhra, Maharashtra’ (Livemint, 20 June 2008) <https://www.livemint.com/Politics/PmupC8HC7U5sItcjZBQWkI/Protests-hold-up-uranium-mining-projects-in-Andhra-Meghalay.html> Accessed on 24 March 2022.
  12. Panchayats (Extension to the Scheduled Areas) Act, 1996.
  13. Orissa Mining Corporation v Ministry of Environment and Forests and Others (2013) 6 SCC 476.
  14. Panchayats (Extension to the Scheduled Areas) Act, 1996 Section 4(e) (i) (k) and (l); Orissa Mining Corporation (n 65) para 59.
  15. FICCI, Development of the Indian Mining Industry (n 59) 59.
  16. Pawan Singh, Arvind Mishra and Deepanshu Singh, ‘A New Model of Exact Reclamation of Post-Mining Land to Address Land Acquisition Problem in Indian Coal Mining Industry’ (2017) 89 Journal of Geological Society of India 307.
  17. Laura Sonter, Chris Moran, Damian Barrett and Britaldo, ‘Processes of Land Use Change in Mining Regions’ (2014) 84 Journal of Cleaner Production 1.
  18. Singh, Mishra and Singh (n 68) 307.
  19. Government of India, National Mineral Policy 2019 (n 48) 8.
  20. Singh, Mishra and Singh (n 68) 307 309.
  21. MMDR Act (n 10) Sections 13 and 15.
  22. MMDR Act (n 10) Section 18.
  23. The Mineral Development and Conservation Rules 2017 Rule 21.
  24. Ibid Rule 24.
  25. Ibid Rule 26.
  26. Ibid Rule 26.
  27. These include the Environmental Protection Act 1986, Forest Conservation Act 1980, Water (Prevention and Control of Pollution) Act 1974, Air (Prevention and Control of Pollution) Act 1981 and the Wildlife (Protection) Act 1972.
  28. Common Cause v Union of India and Others WP (Civil) No. 114/2014 [Order dated 8/01/2020].
  29. Ibid 3.
  30. Indian Bureau of Mines Office of the Chief Controller of Mines, IBM Manual for Appraisal of Final Mine Closure Plan (January 2022) <https://ibm.gov.in/writereaddata/files/01052022125512FMCP%20Manual%20with%20Notice-4Jan2022.pdf> Accessed on 20 March 2022. These guidelines are binding upon mining lease holders as per the Mineral Conservation and Development Rules 2017 Section 22 read with Section 2(m).
  31. The Mineral Conservation and Development Rules 2017 Sections 22 and 26.
  32. IBM, IBM Manual for Appraisal of Final Mine Closure Plan (n 82) 6.
  33. Ibid 7.
  34. Ibid 8.
  35. D Limpitlaw and A Briel, ‘Post Mining Land Use Opportunities in Developing Countries- A Review’ (2014) 114 The Journal of the South African Institute of Mining and Metallurgy 11 901.
  36. IBM, IBM Manual for Appraisal of Final Mine Closure Plan (n 86) 7.
  37. Singh, Mishra and Singh (n 68) 307.
  38. Ibid 309.
  39. Limpitlaw and Briel (n 87) 901.
  40. Ibid.
  41. Singh Mishra and Singh (n 68) 310.
  42. Singh, Mishra and Singh (n 68) 313.
  43. MMDR Act (n 10) Sections 18 and 20A; The Mineral Conservation and Development Rules 2017 Section 26.
  44. Controller General Indian Bureau of Mines, Overview on Reclamation and Rehabilitation of Mines (2016) <https://mines.gov.in/writereaddata/UploadFile/overviewon1.pdf> Accessed on 20 March 2022 14.
  45. Limpitlaw and Briel (n 87) 901 902.
  46. Human Rights Watch, Out of Control: Mining, Regulatory Failure and Human Rights in India (June 2012) 44.
  47. Ibid 36.
  48. Ibid 11, FICCI Mines and Minerals Division, Development of Indian Mining Industry: The Way Forward (n 59) 100 and Deepak Kumar and Others v State of Haryana and Others (2012) 4 SCC 629 637.
(This article is written by This post has been authored by Niharika Mukherjee, a third-year law student at NLSIU, Bangalore.) 
CITE AS: Niharika MukherjeeIndian Mining Law: A Critical Review (Part-II)‘ (The Contemporary Law Forum, 26 August 2022) <https://tclf.in/2022/08/28/indian-mining-law-a-critical-review-part-ii/> date of access.

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