Recycling Is The Only Solution To Manage e-Waste Hazards

India would have been in a better position today to handle the enormous quantities of electronic waste or e-waste in shorter form had it taken note of the serious health and environment damages caused to Guiyu in south China’s coastal province Guangdong where almost every family was engaged in processing imported and indigenous e-waste. What would you expect Guiyou township to become when the people there were extracting valuable materials such as gold, silver and copper from e-waste in makeshift workshops in their backyards without any protection?

As e-waste items would be given acid bath and incinerated and much of that happening by the side of the river, the water got polluted. Remains of heavy metals such as lead, tin and chromium removed from e-waste in a crude fashion settling on ground made the once rice and other crops growing Guiyou barren. The toxic air and water in 54 sq km Guiyu were also the reason for the children having high levels of lead in their blood that would compromise their intelligence and damage development of central nervous system and miscarriages level being much higher than national average.

The health and environment disaster that clumsy recycling continued to wrack on Guiyou, the world’s most notorious dumping ground for e-waste, invited unrelenting global criticism that made an embarrassed Beijing to ask  Guangdong provincial authorities to be quick on cleanup operation. The place rightly earned the moniker the world’s graveyard for e-waste. Farming ruined, Guiyu residents were left with no alternative but to depend on e-waste processing for sustenance.

This being the reality, what Guandong decided in December 2013 and finally executed in 2015 was to move the family run recycling workshops numbering more than 1,200 to an industrial park built at a cost of 1.5 billion yuan ($233 million). While the ones that refused to move their work to the park were banned, those who came in went through many mergers ending in about 30 big operations. The park has enforced strict discipline by way of checking what e-waste comes in for processing and what recovered materials go out.

The reason for deliberating on Guiyu crisis and its resolution by way of official intervention in so many words is because China’s response to combat a health and environment disaster could act as an alert for New Delhi to cope with the fast developing crisis centring e-waste. There is no way we can pretend ignorance that India is the world’s fifth largest generator of e-waste after the US, China, Japan and Germany. The accumulation of such waste and its open air processing as was the case in Guiyu till a few years ago or as is to be widely seen with roadside dismantling of lead acid batteries in our cities and countryside is nothing short of our sitting on an environment and health destroying time bomb ticking away.

Conservatively estimated India’s annual output of e-waste is 2 million tonnes and not more than 5 per cent of that is recycled. Even then for that recycled amount it will not be claimed that much of dismantling of discarded e-materials from smartphones to computers to new age TVs is done scientifically in an ideal environment like what now obtains at Guiyu. Generation of e-waste is not confined to traditional IT products. From air conditioners, refrigerators, washing machines, vacuum cleaners to small appliances such as toasters, irons and coffee machines all now have components that leave e-waste at the end of useful life. Indian rich and the middle class constitute a consumer society with a rising disposable income. Then consumer loans available from banks and other financial institutions help in buying all kinds of things, including electronic products. No wonder the market for consumer electronic products in the country continues to grow at an annual rate of 15 per cent defying major demand slump for automobiles and the whole range of fast moving consumer goods.

Two factors contributing to the growing menace of build-up of e-waste are: First, an unaccountable number of smartphones, laptop computers and several other electronic products come into the country with Indians returning from abroad. Knowing how much such products are appreciated here, foreigners visiting India also bring these as gifts. Second, purely for commercial reasons producers of consumer electronics items, particularly smartphones will launch new products – in most cases an apology for refreshed – at regular intervals to lure customers to buy these and discard the ones with still useful life.

People need to be made aware of the consequences of 95 per cent of e-waste accumulating in individual residences – a south Asian phenomenon of common disinclination to get rid of old things – offices and factories, out in the open and in landfills. Electronic equipment contain toxic materials such as lead, zinc, nickel, chromium and barium. Lead left in the open will cause harm to human health with children in particular suffering damages to blood, kidneys and nervous system. We are seeing here how workers engaged in dismantling end of life vehicles in an archaic fashion suffer health problem. There is mindless throwing here of e-waste in the open but when it gets heated under the sun, toxic chemicals are released in the air to environmental detriment. Leave e-waste in landfills, the toxic elements will seep into groundwater whose use will prove damaging to human health and growing of crops as was seen at Guiyu.

Seeing the emergence of a major crisis, the UPA government enacted e-waste management rules in 2011 and the NDA regime further inserted teeth to the rules twice in 2016 and 2018. But the initiatives have not yielded the desired results in the absence of simultaneous build-up of public awareness of the menace facing them. Thankfully, more recently marketing outfits such as Flipkart, which was acquired in May 2018 by Walmart and Tata group owned Croma have got into the act in tie-ups with some major electronic brands for collection and sending e-waste to centres where it is processed in an environment friendly way.

Let the domestic and foreign companies with manufacturing outfits here follow the example of Apple which is committed to reusing as much of materials recovered from e-waste as possible in its new products. To give an example, Apple is using 100 per cent recycled rare earths in a key component in its new series of iPhones. Finally, the rate of recycling of e-waste in India will depend on motivating consumers to return end of life products to retailers and for that get a decent discount for their new purchases. At the same time, all the stakeholders will have to see that government authorised recycling centres in good numbers which will take care of the health of workers come up in different parts of the country.

Gospel Behind ‘The Giving Pledge’

For a good spell of years, Andrew Carnegie was ahead of John D Rockefeller in terms of individual wealth. This happened following Carnegie’s disposal of Pittsburgh Carnegie Steel Company, which he built in a rare display of vision of a strong industrial America, with the money he made from his investments in a wide range of businesses. But not that much for his pioneering business and industrial activities, the Scottish-American migrant who died in August 1919 at the ripe age of 83 will continue to be gratefully remembered for using most of his wealth to promote education, scientific research and art and culture. Not only is his philanthropy at today’s value worth over $65 billion, benefiting a large number of prestigious institutions, mostly in the US, but also outside Carnegie benefaction is not to be overshadowed by the humanitarian work sans borders by the greatest Samaritans of our times Melinda and Bill Gates.

Carnegie’s vision is written all over in Carnegie Hall in New York, Carnegie Institution of Science and also notably Carnegie Mellon University, which proves beneficial for many south Asians. Andrew Carnegie of his times or a Bill Gates or a Warren Buffett of modern times creates waves of philanthropy inspiring others to part with their wealth for betterment of society. What precisely Gates-Buffett do with their money is to work particularly in areas of health (including fighting of diseases such as AIDs,) education and sanitation that remain beyond the capacity of governments in least developed and developing countries to attend well.

Carnegie’s famous “The Gospel of Wealth” inspired many in the US to follow in his footsteps to do good to society using most of their wealth in a variety of ways. “The Giving Pledge” campaign launched by Melida and Bill Gates is universal in that it has secured commitments from over 200 individuals/couples living in different countries that major portions of their wealth will be used for philanthropic causes. We have only four Indians – Azim Premzi of Wipro, Kiran Mazumdar Shaw of Biocom, Rohini and Nandan Nilekani (one of Infosys founders) and real estate tycoon PNC Menon – to have signed The Giving Pledge. Definitely not an inspiring show when the number of Indian billionaires was 141 in 2018, according to the German statistics portal Statista.

Thankfully, though not a signatory to the pledge, billionaire and chairman of HCL Shiv Nadar is committed to spend $1 billion through his foundation with the focus on building a strong infrastructure for education. What is globally known is besides the declared income, many Indians have undeclared enormous wealth, both within and also stacked outside the country but for reasons, which can only be guessed the owners of such wealth shy away from doing philanthropy. What a waste of wealth from which the country and its people don’t benefit.

But then Rohini Nielkani talks about exercising the Indian “philanthropic muscle” a great degree more breaking the “trust deficit” that exists. She says: “There is a lot of philanthropic capital all dressed up and with nowhere to do, largely because of the trust deficit. How do you give, who do you give to, how do you get impact? You still don’t feel very sure, because of which many of us just land up creating our own organisations, trying to create the change ourselves. I believe that a healthier thing is when the donors (read super wealthy) find enough channels to give through so that there is no burden of doing things themselves.” Not every super wealthy is a Melind or Bill Gates with the intent and capacity to build an organisation to do philanthropic work. Warren Buffett certainly believes that his wealth when channelled through Gates Foundation will yield better results than anything that he might himself attempt. Rohini finds the Indian philanthropy at an exciting stage with the development of an ecosystem for philanthropy along with the idea of giving.

Whatever Rohini may have to say on the subject, the fact remains while wealth levels of Indian elite – businessmen and professionals – are making impressive advances, this has not been matched by commensurate charitable giving. The sad fact is while members of India elite here have never been as well exposed to Western education and way of living as they are now, their philanthropic quotient are way below their peers in the West.

In discussions on philanthropy, generally only the rich will figure. Individuals ordinary in terms of wealth but extraordinary in disposition in charitable giving of almost everything that they have saved diligently over lifetime are not small in numbers in India. The rich have a tendency to build hospitals and educational institutions, which they will name after themselves or their parents under the guise of charitable cause but ensure at the same time that these are run for profit. A branch of the once second richest family in India runs their schools, colleges and hospitals strictly as business. In contrast, you have this 71 year old Chitralekha Mallik, a retired professor, who driven by the joy of giving has so far donated Rs97 lakh to support several causes dear to her heart.

For a teacher coming from a humble family – her father taught at a school – making charity of this scale means she has scrupulously avoided spending any money on herself. Chitralekha lives spartanly in a single room apartment on the outskirts of Calcutta. Though she has difficulty in walking following meeting with an accident in 1994, she is brave enough to travel by bus to Jadavpur University where she gave Rs50 lakh for institution of a research scholarship in memory of her late teacher and PhD guide Pandit Bidhubhusan Bhattacharya and another Rs6 lakh to support a student scholarship in the name of Bhattacharya’s wife. These two besides, Chitralekha has supported some other worthy causes.

Chitralekha, who has made a vow to “give all that I have,” told The Telegraph of Calcutta: “There are two ways through which you can be content. One is by spending on yourself. The other is by distributing what you have among the needy. The latter has been my guiding principle. This is also the lesson of Upanishad.” Her life is an outstanding example of selflessness.

India’s Slide At Happiness Index & Rise In Suicides

Two suicides recently in Calcutta on the same day rudely shook the collective conscience of its citizens. In the tragic case of an 18-year old girl who came to the city to study nursing in a leading medical college death came by way of her hanging herself from the ceiling fan of the hostel room. Samapti Ruidas, who did very well in higher secondary school leaving exam with an average score of 91 per cent, had stars in her eyes when she took admission for a degree in nursing.

Full of life as is the case of girls of her age, Samapti was liked by her classmates. She did not betray any suicidal tendencies except for repeatedly complaining of difficulties she was facing in negotiating the subjects in English. Her father who earns his daily wage by painting buildings borrowed a big amount must be at an usurious rate to finance her study and stay in Calcutta in the hope that the family would see better times once the daughter had earned the nursing degree.

Unfortunately, what the girl didn’t anticipate that for her having all through studied in Bengali, mastering the nursing text in English would prove to be impossible. According to some doctors attached to the college where she was studying and also the police, the feeling of inadequacy of not being good in English and the gnawing fear that her ambition of becoming a paramedic was to collapse, drove her into depression which, however, remained unnoticed.

The other case involved a 74-year old retired cop Asim Mukherjee who took a fatal leap from the fourth floor of the building where he lived with his wife. Here is a case of the victim suffering from depression for quite some time which further deepened as his wife was diagnosed with life-threatening illness. According to the police, Mukherjee attempted suicide twice before. Here is an instance of a man already suffering from depression could not cope with the prospect of loneliness if the ailing wife would predecease him.

The above two cases fall in a pattern. If you come across a woman in India suffering from depression, subject to troubled moods and disturbed brains and slowly becoming unrecognisable even to her relatives and friends, she is one of every four women and every ten men suffering from a disease which has many layers of severity all leading to ebbing of life. Of course relief is there if the victim of depression herself or her near ones will seek medical consultation for her. The earlier the better. The dreaded disease does not spare any sections of society. For example, leading film actor Deepika Padukone became a victim of depression which she openly admitted in a TV interview with Barkha Dutt. Consultation, medication and the care of her mother who came to live with her in Mumbai and ensure that she didn’t miss out on medicine and parental love.

Having herself suffered the trauma of a dreadful existence, Deepika thought of creating an institution to help people stranded in a twilight zone. Her ‘The Live Laugh Love Foundation’ has been formed with the objective to reduce the “stigma, spread awareness and change the way we look at mental health. This is a platform where you can seek help for yourself or a loved one, find comprehensive knowledge, connect with professionals and find comfort knowing that you are not alone.” The last point is particularly important for there are many instances of victims of depression being slowly deserted by friends and relatives leaving them confused and condemned to loneliness. The spread of depression here should ideally be viewed in the context of the World Happiness Index 2018, which measures happiness in 156 countries where India slipped 11 places to find itself in the 133th position. It does not say well of the Modi government that people in neighbouring countries, including China and Pakistan are found happier than us. Some consolation that we are found happier than people in the war torn Afghanistan.

It is well proven cutting across nations that once a person is overtaken by a feeling of loneliness deprived of people to whom they can open up runs the risk of developing suicidal tendencies. Depression if not attended to at early stages could play havoc with individuals. Without proper counselling and medical attention, a stage is reached when depression if not leading to suicide could leave the victims emotionless and inert. According to the World Health Organisation, human brain disorder due to depression is the most acute in India, followed by China and the US. WHO says at least 6.5 per cent of Indian population suffers from some form of serious mental disorder. It is not that cure is not available for the suffering ones. But sadly the country has an “extreme shortage of mental health workers such as psychologists, psychiatrists and doctors.”

From celebrities like Van Gogh (37), Ernest Hemingway (61) and Virginia Woolf (59) to ordinary people will die by suicide for a variety of complex reasons. Specific issues leading people to turn suicidal are as different as their DNA, involving chains of events, which are not always fathomable.

In the meantime, National Crime Records Bureau says in a report that daily wage earners (DWEs) have the largest share of people killing themselves among all occupational groups. The distress of DWEs, who are among the most economically deprived section in the lowest strata of society in terms of income and spending power was sought to be ameliorated through schemes like rural employment guarantee scheme and old age pension. What, however, is not understood why DGEs should be made to work at less than minimum wages for agricultural labourers.

The latest suicide figures relate to 2016. DWEs ending their lives by committing suicide at 25,164 were up 5.7 per cent over the previous year. That they as a group are exposed to most severe economic hardship is borne out by the suicide of 11,379 farmers and agricultural labourers in the same year.

Explaining the reason for the acute privation of DWEs leading many of them to commit suicide, Anamitra Roychowdhury of Jawaharlal Nehru University  told business daily Mint:  “Consecutive years of drought in 2014 and 2015 likely increased the supply of labour to the non-farm sector, impacting wages and availability of work…. Growth in real wages for casual labourers halved between 2004 and 2017… also paints a dismal picture for the non-farm sector.”

The November 8, 2016 demonetisation which played havoc with the economy and now the severe downturn felt in all sectors will further raise the level of deprivation of weaker sections. It will not come as a surprise if more and more heavily indebted DWEs and farmers commit suicide to end their miseries.

Bitter ‘Casteism’ In Sugar Industry

In India casteism is prevalent and practised beyond Hindu society in industry. This is particularly manifest in our sugar industry, which in terms of production is the world’s second largest after Brazil. What is more, we happen to be the biggest consumer of the sweetener on the earth, not a flattering statement on our dietary habit. Casteism in this agro-based industry, which has a major role in sustaining the rural economy of major sugarcane growing states such as Uttar Pradesh, Maharashtra and Karnataka has developed due in no small measure to government patronage to a limited number of groups with ownership of a good number of factories in sizes well over what is considered ideal economies of scale. What also has given them a predominant status in the industry allowing them to influence government policy to their advantage is the location of their mills in areas where sugar content in cane is considerably higher than national average.

The strategy of these groups to invest in a big way in downstream distilleries making ethanol from molasses on a growing scale and power plants producing electricity by burning bagasse has enabled them to stay in the black even during sugar downturn years. Though they too failed on occasions to make payments to cane supplying farmers in their captive area during the last two seasons marked by bumper production here and globally and low prices for sugar, these groups began the 2019-20 cane crushing year with cane bills cleared. Lucky are the farmers supplying the raw material to such groups.

Sadly, no such comfort is available to millions of others growing cane for use by factories not in good financial health and, therefore, not able to honour export obligations. The system works like this: In a year of sugar surplus when under supply pressure, ex-factory price of the commodity falls much short of production cost, New Delhi will sanction an export quota for the industry which then is equitably apportioned among sugar factories. Not every industry constituent will, however, sell sugar in the world. Industry official Om Prakash Dhanuka says cane crushing mills far removed from ports like the ones in Bihar and the ones not familiar with global trade will give their export quota to groups not far away from the coast and also engaged in export.

There is a catch here: When global sugar prices rule higher than in India, the transferor (a unit not using the quota itself) will ask and get paid for using the quota by the transferee. But when opposite is the case as now, quotas will not change hands unless the transferee is compensated for the loss to be incurred in export. But a number of factories following their poor working over the past many seasons find their finances in such parlous state that there is no way they can rustle up money to compensate the transferee for the loss embedded in exports.

As is the case, farmers supplying cane to mills not able to execute the allotted quantity of export are to bear the brunt though they are not in any way responsible for export not happening. The government gives two types of subsidies to make exports feasible. (The objective is if a significant portion of the massive inventory of sugar with mills cane be sold in the world market then the industry will be spared the cost of carrying stocks to the extent of exports. Moreover, the sheer presence of a massive inventory – the current season has opened with bewilderingly high stocks of 14.57m tonnes – keeps sugar prices low compromising mill capacity to clear cane bills.)  First, mills are compensated for the cost incurred to move sugar marked for export from factory to the port.

Second, where farmers come in is the stipulation that the cane subsidy will be directly credited to the bank accounts of growers supplying the raw material only to exporting mills. This also is a relief to mills for the subsidy is to extinguish a portion of cane price dues. On August 28, the cabinet committee on economic affairs approved export subsidy of Rs10,448 a tonne to sugar mills involving an expenditure of Rs6,268 crore to facilitate export of 6m tonnes by 2020 September end. Cane growers in pockets of UP and Bihar linked to weak factories are wondering aloud why should they be penalised by way of denial of cane subsidy whatever the omission by industry constituents. For the sake of argument, it can be said that the subsidy is linked to export and therefore, the government is not to be blamed if farmers making supplies to non-performing mills are left out of the scheme.

But the economic sufferings of millions of farmers resulting from mills not being able to clear cane bills running into months should be of concern to the government. Around 190 of 525 odd factories in the country are in distress – in most cases it is acute and in others it is moderately so. As is known, sugarcane is the most important of all cash crops in the country for whose payment within two weeks of delivery to factories is guaranteed by the government. The fair and remunerative price (FRP) at Rs275 a quintal for the current season, same as last time is fixed annually by New Delhi on a review of recommendations by Commission for Agricultural Costs and Prices (CACP). While some states stick to FRP, some others have state advised prices (SAP), which actually mean loading FRP with a premium.

The cash crop moniker for cane lost all its meaning when in May the industry owed over Rs21,000 crore to farmers, including Rs12,00 crore to growers in UP. Even now, all-India cane dues remain at Rs10,000 crore with UP having the largest share of Rs4,000 crore. No wonder cane growers denied of payments by mills are seeing their debts rising to unacceptable levels standing in the way of meeting their social commitments, including weddings and sradhs. This and also reports that except for a few crops like rice and wheat are sold below MSP are contributing in no small way to fall in demand for fast moving consumer goods in rural India. This financial year’s first half working of Hindustan Unilever to ITC to Godrej Consumer Products will all attest to it. The sugar industry was given an export quota of 5m tonnes for the season ended September 2019. But actual shipments to foreign destinations were 3.8m tonnes. No doubt, the inability of weak mills to participate in exports will explain the shortfall in overall despatches of sugar abroad. This year, New Delhi has given the industry a bigger 6m tonne export quota. But again for reasons of poor financial health, ailing and sick sugar mills will have no role in export. When sick mills need support in every possible way, has come the distressing news of their buffer quota being reduced for their failure to participate in export. The size of sugar buffer, the maintenance and interest cost of which is financed by the government, has been raised to 4m tonnes for the current season against 3m tonnes in 2018-19. The fact remains that more are the weak mills made to suffer, greater will be the distress for farmers.

Can Orissa’s Mineral Wealth Reach Bottom Of Pyramid?

The challenge for Indian bureaucrats from the level of district magistrate to chief secretary, on whose shoulders rest welfare-oriented administration of a state, is to understand well “local aspirations” and then create condition for their fulfilment. Indian administrative services, inherited largely from the British Raj but with many amendments and improvements since Independence, require young recruits to spend a good number of years in districts to have a feel of the challenges facing Bharat, distinct from urban India, before they are moved to state capitals or to the Centre.

Orissa chief secretary Asit Kumar Tripathy, who remembers his days long time in the past at Rourkela, which figures prominently in the national map as a major steel producing centre, where he was additional DM, admits that “local aspirations” for jobs and economic opportunities in several mineral producing centres in the state have remained largely unfulfilled. Tripathy makes a particular reference to Keonjhar district, which “makes a significantly large contribution to the state’s iron ore production, but is still without a steel plant.”

Such a venture, ideally to be undertaken by the private sector or in its absence by a union government owned undertaking, would create thousands of jobs directly and in the tertiary sectors requiring a variety of skills. These may not be available at Keonjhar at this point. But skills impartation to the local youth is a challenge that the state is ready to undertake.

Orissa’s endowments in the form of abundant natural resources such as iron ore, bauxite, coal and chrome ore should lead to job creation outside agriculture in mining and equally importantly in their local processing. Many see in the rise in demand for local processing of industrial raw materials instead of allowing their easy movement across the country a spurt in sub-nationalist sentiment. This may not be in conformity with the idea of India. But then the challenge for state level leaders is to take care of “local aspirations” for economic opportunities. We have not as yet found way to strike a balance between the two pulls.

The gross state domestic product (GSDP) growth in Orissa in recent years has been better than many states and also higher than the country’s GDP growth rate. Commendably, the eastern state grew at 8.4 per cent in 2018-19 compared with 7.4 per cent in the previous year. Orissa will be required to advance sustainably at a high rate and ensure that the resulting benefits percolate down to weakest sections of society. Incidentally, Orissa is next only to Bihar among the country’s bigger states to have the maximum number of people below the poverty line. According to Niti Aayog SDG India Index Baseline Report, 32.59 per cent of population of Orissa exist below the poverty line against 33.74 per cent in Bihar. 

No one will grudge the state claiming credit for a higher rate of growth of 6.6 per cent over a seven year period in per capita income to Rs75,796 when the national average was 6.1 per cent. But where are the evidences except for the information provided in the state economic survey that the average monthly household income in agriculture where close to 48 per cent of workers are engaged has continued to rise since 2012-13 that the condition of the poorest of the poor is improving at a desired rate? As has been seen in many states, including Andhra Pradesh, Chhattisgarh and Orissa, people below the poverty line swell the ranks of Maoists.

Poverty alleviation will demand more and more mineral deposits are put to auction for opening of new mines. Mineral deposits are found in remote places where there is hardly any economic activity. Official data show the Orissa mining sector contributes 10.8 per cent to GSDP. A friendlier disposition to mining by way of giving clearances quickly and lowering state levies on the basis of discussions with miners will see in a few years the sector’s share in GSDP going up by quite a few notches. Boosting minerals production will only be half the battle won. At a recent brainstorming session in Delhi with steel industry leaders by the steel ministry, Tripathy regretted that even while Orissa government had been proactive in reserving land in abundance in places like Kalinganagar, Rourkela and Keonjhar, “land capacity utilisation” had remained low to the disappointment of state administration.

According to the latest survey by the Indian Bureau of Mines, in the country’s iron ore resources of 31.32bn tonnes, the share of Orissa is 7.2bn tonnes, largest among all states. Not only this, the state which accounts for around half the country’s production of iron ore, extracted 118.5m tonnes in 2018-19, up 12.8 per cent over the previous year. So Tripathy’s disappointment is understandable that so much ore is leaving the state instead of being processed within. But at the same time what is to be taken into account is his admission that at “about 30m tonne crude steel capacity, logistics concerning moving steel making ingredients from mines and ports to steel mills and then egression of finished steel products is a nightmare.” The primary reason for nightmarish state of logistics, as is underlined in the economic survey is the very poor rail connectivity in the principal mining and steel production centres.

Chief minister Naveen Patnaik says: “The state generates revenue in excess of Rs15,000 crore for the railways. Yet the entire route length in Orissa is only around 2,500 km with a density of 16, which is much less than the national average of 20. What is more, it is hugely lower compared to adjoining states like West Bengal with density of 43.4 and Jharkhand 24.3.” The minerals and metals industries suffer the most from shortages of wagon rakes during the summer when the railways are required to give “high priority” to move coal to power plants. What kind of pressure steelmaking brings to bear upon logistics becomes understandable when what Tripathy says is considered: For every tonne of steel, three tonnes of raw materials are to be moved to mills and then finished products are to be sent out to domestic and global markets.

The available logistics in the form of rail and road transport is not found good enough to support steel capacity of 30m tonnes. One then wonders how will Orissa, which is supposed to have a share of 100m tonnes in the country’s projected 300m tonne steel capacity build up by 2030-31 support that big an industry with the available infrastructure. Till now, signs are not there of rapid development of infrastructure. Tripathy sees in building of “multimodal transportation in which the state’s two major rivers Brahmani and Baitarani will pay a major role” the answer to logistical challenges emerging from the steel industry. River transportation much in use in the US and Europe to move dry bulk cargoes is cost effective and environment friendly. At the same time, Orissa’s railway network for movement of goods needs rapid beefing up.

Modi-Yogi Doublespeak On Renewable Energy

The Uttar Pradesh government is working at cross purposes with the Centre’s policy to promote non-fossil fuels based energy

‘If wishes were horses, beggars would ride’ is an old Scottish proverb dating back to the 17th century which looks to have gone down well with our Prime Minister Narendra Modi. Achievable or not, Modi keeps on making promises not necessarily supported by ground reality. But he has the advantage of people trusting him. Modi won many hearts, specially of the environmentalists, when at the recent United Nations climate action summit in New York he announced India ambitiously resetting the renewable energy (RE) target at 450 gigawatt even while the country is losing steam in its march towards the 2022 RE capacity goal of 175 GW.

A combination of factors, including policy deficit, state governments insisting on low tariffs for electricity derived from renewable sources and they not always honouring power purchase agreements (PPAs) or revising PPAs arbitrarily marks the Indian RE power scene. No wonder then solar power capacity addition here last year was down to 6.5 GW from 9.4 GW in 2017-18 and in the first quarter of 2019-20, it was a disappointing 1.4 GW.

US President Donald Trump had reasons to demur when Modi said that the world was not doing enough to overcome the challenge of climate change. Therefore, he bravely announced at the summit that “India is here not just to talk about the seriousness of this issue, but to present a practical approach and a road map. We believe an ounce of practice is worth more than a tonne of preaching.” But back home, Modi has to contend with the fact that India is a Republic where the states have full powers on many subjects, including agriculture and there is also a concurrent list, leaving room for serious disagreements on issues.

Apparently, it should work to the advantage of Modi that the Hindu nationalist Bharatiya Janata Party as it has a formidable majority at the centre, it runs the government in 21 states either on its own or in partnership with other parties. Uttar Pradesh happens to be India’s largest state, which, according to Modi himself, suffers from development indicators of sub-Saharan Africa than anywhere else in Asia. UP remains among the least preferred investment destinations because of poor law and order situation, religious strife, governance deficit and power shortages. The UP scene has not improved at all in the last couple of years though BJP has 312 of 403 Assembly seats.

BJP being in absolute power both at the Centre and in Lucknow, it should be a given that the latter will faithfully dispose what the prime minister may be proposing. Unfortunately, this is not happening in the case of promotion of green energy. Considering the fact that the state happens to be the country’s largest producer of sugarcane and sugar, it has the potential to produce more green energy in the form of ethanol for blending with petrol and also produce clean electricity by burning bagasse. Om Prakash Dhanuka, a former president of Indian Sugar Mills Association, says: “The sugar industry presents the unique example of converting by-products of sugarcane, namely, molasses and bagasse into wealth in the form of renewable green energy. The carbon footprint of ethanol and bagasse fired electricity is considerably less than energy derived from fossil fuels such as crude oil and coal. Moreover, the higher the supply of renewable green energy, more will the country save on cost of imports of oil and coal.”

Even while India has estimated geological coal resources of 319.02bn tonnes and its 2018-19 production was 731m tonnes, up 8.1 per cent from 675.40m tonnes in 2017-18, India still had to import as much as 236m tonnes last year against 209m tonnes in the previous year. Perhaps more worrisome is the country’s oil import dependence going up from 80.6 per cent in 2015-16 to 83.7 per cent in 2018-19 with oil consumption during this period growing from 184.7m tonnes to 211.6m tonnes. The country’s oil import bill ominously rose from ₹171,702 crore in 2005-06 to ₹881,282 crore in 2018-19. “We need to give a push to rapid development of green energy capacity by making optimal use of sustainable resources such as sunlight abundantly available in most parts of the country, wind and biomass in the context of the Organisation of Petroleum Exporting Countries (OPEC) forecast that India would record the fastest annual average oil demand growth in the world at 3.7 per cent through 2040. We also have reasons to be greatly concerned about our hosting 14 of the world’s 20 most polluted cities,” says Dhanuka. Rapid growth in oil demand has to be seen against the background of the country declaring an ambition to become a $5 trillion economy in the next five to six years from the present $2.8 trillion.

The compulsion to have cleaner air in our cities and also to relieve the pressure that oil imports leave on our balance of payments, New Delhi has recently given some major incentives to sugar mills for stepping up production of ethanol, which should progressively raise the rate of its blending with petrol. Traditionally, here ethanol is made from what is called C heavy molasses, that is, after most juice is extracted from cane for sugar making. Going a step forward and in order also to counter the sugar industry’ viability being compromised under the weight of overproduction of the sweetener for two seasons in a row, New Delhi last year wisely allowed the industry to use B heavy molasses, which retains a good amount of juice. Going even a step forward, the government has cleared cane crushing factories to produce ethanol directly from cane juice. Prices for ethanol to be made from all three categories have been revised upwards to the industry’s satisfaction. A major relief came its way with goods & services tax reset at 5 per cent from the earlier 18 per cent.

But the Yogi Adityanath administration in disregard to what the centre is trying to do has given an order that sugar mills in UP will have to reserve 16 per cent of their C heavy molasses for units engaged in making country made liquor (CML) against 12.5 per cent earlier. The state government excuse for the unjustified move is since molasses production in the 2018-19 sugar season (October to September) is down to 4.7m tonnes from 5.5m tonnes expected earlier, CML producers in the state need to be compensated by raising the percentage of their molasses entitlement. While sugar factories will be parting with the 16 per cent quota of C heavy molasses at ₹75 a quintal, if they are to buy it from the market the cost will be anything between ₹450 and ₹500 a quintal. CML and India made foreign liquor (IMFL) happen to be the two most important sources of excise revenue for the state. It is precisely for the sake of revenue that the interest of the sugar industry has been sacrificed.

Then again the arbitrary decision by the UP Electricity Regulatory Commission that henceforward sugar factories will get ₹2.89 a unit against the earlier ₹4.88 a unit for their cogenerated electricity derived by way of burning bagasse has come as a disincentive for sugar factories on green energy mission. The Commission has arrived at the lower electricity rate by assuming without any justification the cost of bagasse at ₹1,000 a tonne from the earlier ₹1,600 a tonne. The current UP market rate for bagasse is, however, ₹1,800 a tonne. The two instances show beyond doubt that the UP government is working at cross purposes with the centre’s policy to promote non-fossil fuels based energy.


Recycle Old Vehicles: Curb Pollution, Create Business

The government must motivate people to give up 15-year-old vehicles by incentivising the process. Next, it must draft a sound scrappage policy and build a chain of recycling units across the country

We don’t expect our leaders to be aware of the works of the two world’s leading environmental economists Martin Weitzman, the recluse who passed away on August 27 and the Nobel laureate William Nordhaus. Even then they, specially the ones living in Delhi who are exposed to inhaling toxic air, should be well aware that the millions of end of life vehicles (ELVs) are the principal culprits for fouling the city environment.

As early as 2000, New Delhi drawing lessons from the standards in the US where the focus is on emission of nitrogen oxides (NOx) and particulate matter (PM) and the European Union where the concern is more about carbon dioxide (CO2) and carbon monoxide (CO) formulated Bharat Stage Emission Standards (BSES). In phases, the norms were made more stringent and once a new stage is set, all new vehicles will have to compulsorily conform to it.

Now the government in an attempt to ensure that all new vehicles still do less harm to air quality is leapfrogging Bharat Stage V to BS-VI to be effective from April 1, 2020. This definitely is an environment positive move, though introduction of improved technology will mean higher prices for vehicles. Definitely a small price to pay for air quality improvement. The automobile industry’s concern is that this is to happen when it is facing the worst demand slump in two decades.

Sales of cars and SUVs fell for ten months in a row till August 2019. Every manufacturer, except for new entrants like South Korean Kia and Morris Garages (popularly known as MG) owned by Chinese state enterprise SAIC, has been forced by sharp demand collapse to cut production and shut factories and showrooms. But in the process countless number of workers had to be laid off. Unfortunately our finance minister Nirmala Sitharaman instead of acknowledging what is happening in the automobile industry is one manifestation of the economy being gripped in a deep economic crisis wanted us to believe that shared mobility and young people using Ola and Uber services are the cause.

No doubt lowering of Goods & Services Tax (GST) from the peak slab 28 per cent to 18 per cent could prove to be an effective stimulus for demand revival. Many states with their finances in a bad shape are expectedly demurring. But as the situation is, the GST Council should be able to reach a consensus that cars up to a value of say Rs10 lakh will attract 18 per cent GST to encourage middle class to own vehicles. The empirical evidence through all economic crises here and elsewhere is that buying by the rich and the very rich are immune to market swings. Therefore, let the exchequer continue to get the maximum from sales of the likes of BMW, Benz, Aston Martin, Porsche and Bugatti, all recession proof.

To return to ELVs from the current automobile crisis. We have on the registers of regional transport authorities, a disturbingly large number of 28 million ELVs, predating introduction of BSES seriously compromising air quality, particularly in our principal cities. Ideally, 15 year old vehicles should be sent to scrap yard. This is based on global experience that emission level of old cars is ten times more than the ones in ideal condition. In the case of ageing trucks, their emissions are at least eight times higher than the new ones. The question is why ELVs in such numbers are still running in already highly polluted cities like Delhi, Mumbai and Kolkata without the authorities taking action against the owners? Obviously, the authorities don’t want to offend the urban middle class and transport companies in which many politicians have a stake.

Even while a vehicle scrappage policy is under consideration for quite some time, the lawmakers are not able to decide whether the owners will be forced to surrender more than 15 year old vehicles for dismantling or the scheme will be principally voluntary but with such built-in incentives that will motivate people to surrender ELVs. Back in 2016, the government was toying with a voluntary vehicle fleet modernisation programme. But nothing came out of that. In recent weeks minister for highways and transport Nitin Gadkari and Sitharaman have spoken of the need for a well considered scrappage policy.

They will do well to heed the advice of industry veteran Pawan Kr. Goenka, managing director of Mahindra & Mahindra. He says in our kind of situation the scrappage policy cannot be mandatory but has to be motivational for ELVs surrender. “People who are doing with old vehicles belong to the lowest economic bracket among vehicle owners. You should not force them to give up their vehicles. That will not be right. It has to be voluntary and incentivised. It’s also important to offer a considerable incentive to motivate people to send ELVs for scrapping,” Goenka says.

Environment and replacement of scrapped vehicles by new ones using the vehicle surrender linked incentive money are not the only issues involved in the scrappage programme. Apply the circular economy concept, you will find in ELVs sent for ‘depollution. dismantling, baling and shredding’ have a lot of wealth in the form recovered metals, specially steel, which is an important feedstock for steelmakers using electric arc furnaces (EAFs) and induction furnaces (IFs).

The thriving unorganised vehicle recycling units through their highly unscientific and environment compromising process are annually generating around 28m tonnes of steel scrap against requirements of 35m tonnes by the steel industry. Therefore the deficit of 7m tonnes are imported from the European Union, UAE, the US, Japan, etcetera, at considerable outgo of foreign exchange. The steel ministry has estimated that EAFs and IFs here will need 55m tonnes of scrap by 2030-31.

Ministry officials say considering the large local ELV population, India is well placed to generate enough scrap to meet the steel industry’s future demand for this raw material and imports could be eliminated. But for this to happen, the country must build a chain of authorised recycling units in different parts of the country equipped with automated plant and machinery. Why only self-reliance, there is potential to create modern recycling units close to ports which will facilitate import of ELVs from south and south-east Asia and the Far East and then export steel scrap. Unlike India, many countries in this part of the world do not have blast furnaces (where iron ore is used) and make all their steel through EAFs and IFs. They will be ready buyers of any surplus steel scrap that this country may generate in future.


Can India Implement Ban On Single-Use Plastic?

Plastics manufacturers are trying to find fixes of popular concerns but the petrochemical industry has a strong lobby and this is why violations of environmental norms happen with impunity

It is not a day too soon there is promise of India coming down with some force on the single use plastic, which the quintessential bottle holding still water principally represents. In the available order in the country, hardly anything of importance will move till the prime minister himself will herald a campaign. For example, the Swachh Bharat Abhiyan, a five-year mission launched with great fanfare in 2014 coinciding with the 150th birth anniversary of Mahatma Gandhi took wing nationally because Narendra Modi made it his signature policy. Even then, we will be far from a ‘clean India’ by this yearend because of citizenry apathy. Hopefully, he will do better with putting a stop to the use-once-and-discard plastic items.

On the Independence Day speaking from the ramparts of Red Fort, Modi said: “Can we free India from single use plastic? The time for implementing such an idea has come. May teams be motivated to work in this direction.” Earlier on the World Environment Day in 2018, the then minister for environment, forest and climate change Harsh Vardan said attempts would be made to phase out use of single use plastic by 2022. Not unexpectedly, nothing worth telling has happened since the minister spoke. Except for a good number of states notifying full or partial ban on single use plastic.

But as is not uncommon in India, the state level fiat is respected more in violation than in observance. What is to be remembered is that the petrochemical industry has a strong lobby and this is the reason why violations happen with impunity. Is it any surprise then that the country’s leading retailers such as Big Bazaar, Reliance Retail and V Mart are far from being environment friendly as they continue to give buyers the bought items in plastic bags? An example of the triumph of convenience and consumer preference over keeping the environment clean.

Plastics, the emblem of postwar consumerism are described as the workhorse of modern economy. They are finding a wide range of applications because of their light weight, robustness, easy formability and price advantage over competition. Riding on these strengths, global annual production of plastics advanced from 15m tonnes in 1964 to over 350m tonnes presently. Consulting firm McKinsey says in case the present rate of demand growth is sustained, albeit defying the spasm of popular disgust against the harmful effect on environment and health, then plastics output will take a leap to 600m tonnes by 2034. Confidence about demand growth is high among producers, particularly in the US. The North American market is seeing record amounts of capacity in the pipeline.

Not surprisingly green activists and others are alarmed by the development. The concern is because not only are there emissions of enormous quantities of greenhouse gases in the course of production of plastics, the environment suffers further damage as overwhelmingly large portions of used plastics go into landfills, or are burnt or are left to litter everywhere from city streets to seashores to foothills of mountains. We do this without realising that plastics escaping the established waste collection system will be floating on the earth for centuries, all the time causing harm to the environment. The intended life of single use plastic products is not even a year but for the laxity on the part of administration in India and elsewhere they virtually get an infinite life.

A report co-authored by McKinsey, Ellen MacArthur Foundation and the World Economic Forum estimates the negative externalities of plastics at $40bn, including pollution impact and that is more than the industry’s annual profits. The report gives the warning that if the future demand growth for plastic products remains at the current rate then the global plastic-waste volume will climb to 460m tonnes a year by 2030 from 260m tonnes in 2016. The present waste volume is already a major environmental concern. But the waste size forecast for the future will take the problem to “a whole new level,” says the report. A chart prepared by culling information from multiple sources shows the recycle rate of plastics at lower than 40 per cent compares poorly with steel at 80 per cent, aluminium cans and glass at 78 per cent and beverage carton at 43 per cent. What particularly raises despair is the rate of recycling rate at a pathetically low of 10 per cent for polyethylene, which is the most commonly produced plastic.

As against the growing public discontent over the poor rate of plastic recycling, the World Steel Association and International Aluminium Association are upholding the virtues of circular economy under which not only the end of life metal products are collected and shredded for recycling but facilities have been built in production systems for optimum reuse of water and energy. Public anger besides that is forcing more and more governments to take action against single use plastics – as many as 127 countries have either banned or levied taxes on disposable plastic bags – the industry will have to contend with competition emerging from alternative biodegradable products such as wood fibre bottle, recently unveiled by brewer Carlsberg. Is it not time for jute goods makers to put their house in order to regain the market lost to plastic bags used in packing foodgrains and sugar? Unfortunately, ownership of jute mills, except for a few, has moved from respectable corporate houses to traders who lack foresight.

Modi hasn’t spelt it out in any detail, but his angst must be occasioned by almost a third of all plastic packaging leaks amounting to more than 8m tonnes a year finding its way into the oceans polluting waters. No wonder we read frequently reports of marine species such as whales, turtles and fishes perishing due to their unwittingly ingesting plastics thinking these to be food and choking themselves to death. To everyone’s horror, microplastics have been found in the remote reaches of the Arctic. Not only in tap water, but plastic fibres are found in more than 90 per cent of bottled water.

No wonder then plastics manufacturers are finally trying to find fixes of popular concerns. Some independent companies are working on breaking down plastics into their components for conversion into new materials. Scientists say waste polyethylene is a potential carbon source that could be made into value added polymers. Noticeable progress has been made in laboratories to turn waste plastics into a pliable wax like substance to which then is added other elements resulting into bioplastics. We don’t have at this point any estimate of how much of waste plastics in India could be recycled. But developed countries are targeting 70 per cent recycling by 2030. McKinsey has recommended decoupling of plastics from fossil feedstocks by way of exploring and establishing renewably sourced feedstocks. But this will be a journey which will meet with serious opposition from the powerful oil industry.

India Facing a Severe Water Crisis

Water – India Has A Hole In The Bucket!

Indiscriminate extraction of precious groundwater and recurring monsoon deficits are leading the country to a severe water crisis in the near future

Decades of neglect in rightly managing our fresh water resources, which in any case are quite tight considering its multipurpose uses, including supporting agricultural operation and quenching the thirst of over 1.3 billion, is now spelling untold miseries to millions across the country as it poses a threat to India’s ambitious growth targets.

Drought having gripped 43 per cent of the country and the monsoon deficit still at 17 per cent, thanks to some strong rains in the north but masking the persistent rains shortfall in the south, a large percentage of population is having a nightmarish existence. The government machinery as usual is found wanting in providing relief to people living in parched parts of our earth.

The principal culprit for the current state of affairs is unarguably the indiscriminate way we have been extracting groundwater and in the process earning the dubious distinction of being the world’s most aggressive miner of the precious resource. To put it in perspective, India’s groundwater extraction exceeds the combined tally of the world’s second and third largest users, namely, China and the US.

India is home to 17 per cent of the world population but has to make do with 4 per cent of the earth’s fresh water. China, which houses more than a fifth of the world population, has only 7 per cent of its fresh water. It, however, faces the perennial challenge of meeting minimum water requirements of North China plains where close to 42 per cent of the country’s population lives but holds only 8 per cent of its water resource.

Like China, the US owns 7 per cent of the world fresh water. But it has the advantage of being home to 4.3 per cent of world population. No wonder, the US indulges in the luxury of leaving an average water footprint that is double the global average. No matter that the country owns the world’s largest fresh water lake system in the world in its Great Lakes and the mighty Mississippi river, the importance of conservation and efficiency in use for future security in water supply is not lost on the US Administration. Incidentally, water is one of the seven science missions of the US Geological Survey.

We in India are sourcing over 70 per cent of our water requirements from below the surface drilling aquifers at progressively greater depths without leaving adequate time for natural replenishment. Mihir Shah, a former member of the defunct Planning Commission says: “Over the last four decades, around 84 per cent addition to the irrigated area came from groundwater. Most of this was from deep drilling of tubewells or borewells, which are the single largest source of irrigation as also drinking water, in both rural and urban India.”

Going deeper and deeper the aquifers for water extraction has meant our mining the resource in a growing number of places where the water comes with unacceptable levels of fluoride, arsenic and iron. Use of such water leaves people with serious bone deformities and lung and bladder cancer. Extraction of groundwater at levels where the resource found is polluted and its use results in the government spending millions for treatment of the diseased.

A major failing of our hydrological planning is not conserving enough water for offseason that is beyond the monsoon months. Even after we have built a few thousand large and small dams in different parts of the country, our per capita storage of 215 cubic metre (CM) compares unfavourably with 1,111 CM in China and 1,964 CM in the US. In water conservation, Russia’s per capita tally at 6,103 is way ahead of other countries.

Prime Minister Narendra Modi in his first monthly radio broadcast programme ‘Mann ki Bat’ after winning the elections reminded the water hungry listeners that “only 8 per cent of all rain water in India is conserved… It’s now time to solve the problem” by giving a push to greater grassroots water conservation efforts. What the PM has proposed now should have actually been implemented in past years with great force. Maybe the administration is awakened to the situation now because of the spectre of millions of people in drought affected parts of the country are driven to the edge and food production is to take a hammering. The latter is because more than half of the country’s arable land is rain-fed. India receives around 70 per cent of rains during the southwest monsoon beginning in June and petering out in mid-September.

What India must be geared to is the weakening monsoon in South Asia caused by climate change. Rains in the region were below average for five years in a row, with 2015 being the worst at 86 per cent. Think tank Niti Aayog says in a report that the country faces the harrowing prospect of 40 per cent of its people not having access to drinking water by 2030.

Furthermore, at least 21 cities, including the national capital will run out of groundwater in 2020.  Hospitals in southern Indian states finding piped water supply gone dry are getting it for the time being from local politicians owned fleets of water tankers at usurious rates. But this source of water may also run dry and too soon.

In Delhi, less than one fifth of homes have the luxury of piped water supply. In a growing number of places, whatever groundwater is extracted comes with chemicals and other contaminants. It is in the context of tightening water supply is to be seen Modi’s promise of delivering piped water to every home by 2024. As things are now, there is every chance of this post election victory promise remaining unfulfilled as his earlier commitment to create 10 million jobs every year.

Veena Srinivasan of Ashoka Trust for Research in Ecology and Environment will attribute the deteriorating water scene in the country to “multiple causes, both climate and anthropogenic… Of course, the drought itself is caused by a deficit in precipitation and climate change certainly has something to do with the changing precipitation patterns. But… we can’t absolve ourselves from the crisis that we ourselves have precipitated with mismanagement, and specifically by over-extracting groundwater.” She thinks Green Revolution gave licence to millions of farmers to use groundwater without limits to “rise out of poverty.”

The fact is when in the beginning of the sixties India was plunged in a major food crisis, Norman Borlaug and his prescription for breakthrough in rice and wheat productivity not only made the country self-reliant in food but also generated surplus for exports. Remember when Green Revolution was launched, the awareness of water conservation was hardly there in India or for that matter anywhere else. In subsequent times, however, the administration in Punjab and Haryana should have discouraged water guzzling rice cultivation in favour of less water using crops. In any case, the present crisis could have been avoided by the local government disallowing indiscriminate exploitation of underground water.

Farm and allied sector’s contribution to gross domestic product (GDP) has come down over the years to less than 15 per cent while it accounts for over 90 per cent of total water use. Again nearly 90 per cent of extracted groundwater is used in irrigation. But as Niti Aayog CEO Amitabh Kant says water use efficiency in our farm sector is among the lowest in the world. He says: “Our farmers use three to five times more water than Chinese, Israeli and American farmers for producing the same crop.” The remedy prescribes by Kant is to motivate farmers to “adopt cropping patterns based on agro-climatic zoning” to economise on water use. At the same time, radical modification of “subsidies and minimum support price” is needed to “disincentivise farmers from growing water intensive crops.”

Om Prakash Dhanuka, a former president of Indian Sugar Mills Association and a Bihar based producer of sugar, sees no justification of growing highly water-intensive sugarcane in parts of the country, which are highly drought prone and perennially short of water. Because of our surplus sugar production, we are desperate to export large quantities to wriggle out of price falls in the domestic market. But we must remember that when we are exporting sugar or rice, we are also exporting water.

Dhanuka, however, says: “It’s not all despair. For example, at Hiware Bazar village in Maharashtra, the community of farmers is opting out of sugarcane and cotton growing for less water-intensive crops. Farmers are not allowing any more digging of borewells and they are practising water management on scientific lines. We are also seeing similar farmer initiative in Andhra Pradesh and Telengana. Water management will have to be a nationwide movement in which the government, scientists and farmer community must participate wholeheartedly.”


Glaring Chinks In Iron Ore Mining Policy

All stakeholders in the mineral mining sectors are living in uncertain times, thanks to flawed lease policies by Union and state governments

Mineral resources in India from iron ore to bauxite to coal are majorly found in remote centres of Orissa, Jharkhand and Chhattisgarh where people, who hardly figure on the radar of the powers that be in Delhi, eke out a difficult existence unless they are employed by mining groups for ore extraction and allied works. No wonder then, when resources remain hidden under the earth and in the absence of their raisings, the places become fertile ground for spread of extremist movement or what is popularly known as Naxalism in India. The country’s mineral belts are generally rains deficient and the hard stony soil there does not support worthwhile crop cultivation.

The fragile peace that exists in the country’s sensitive mineral-bearing regions will be put to test as the leases of merchant miners of iron ore and manganese ore will expire on March 31, 2020 under a directive of the January 2015 amendment of the 1957 Mines and Minerals (Development and Regulation) Act.

In a questionable wisdom, the authors of the amended Act had for the first time made a distinction between merchant, captive and government groups owned mines. In what appears to be palpable discrimination, the 2015 version of the Act prescribes that while the existing leases of non-captive merchant miners are valid till March 2020 that of captive mines will remain in force till March 2030. What is more captive mine owners alone are given the right of first refusal when their mines are put up for auction.

As for Union and state government owned companies such as Steel Authority of India, National Mineral Development Corporation and Orissa Mining Corporation, they are allowed extension of existing leases for a period of 20 years at a time beyond the stipulated period of 50 years. Remember, ahead of 2015, there was no distinction between captive, non-captive and government ownership of mines. In every respect, including lease tenure, all three groups got identical treatment under the law.  No longer so.

Discrimination part may or may not get set right by way of amendment of the 2015 MMDR Act. But what is of immediate concern is the large number of iron ore and some manganese ore mines owned by merchant groups that will stop operation on lease expiry in March 2020 making in the process thousands of workers unemployed. The same fate is awaiting many more thousands who are engaged in the long chain of logistics between mines and use of iron ore by steel mills domestically and in foreign destinations. This is to happen when the country’s unemployment rate is worryingly high and few new jobs are created with deceleration in economic growth.

Speak to minerals industry experts and they will tell you in one voice that there is no way the concerned state governments will be able to complete auction of the merchant mines whose tenure of leases will run out in nine months. Even assuming that auctions are held and successful bidders chosen, it will take them a long time, going by established patterns to secure all the sanctions, including environment and forest clearances (ECs and FCs) before they could start ore extraction.  Yes, the Supreme Court has given a ruling that for auctioned mines that were operational earlier, the new lessees would automatically get ECs and FCs transferred to them from earlier lessees. But we are seeing new lessees’ frustrating wait for transfer of ECs and FCs for mines in Karnataka.

This correspondent on his recent visits to some Orissa and Jharkhand mines whose leases are to expire next March found workers and managers rattled by an unsettled future awaiting them. They have no clue as to whether the central government in view of the inevitability of anarchy setting in mining centres will do the sensible thing of extending leases of merchant miners to 2030 in line with captive mines or it will let mayhem happen.

The ground reality is this. It emerged at a recent mines ministry coordination cum empowered committee (CCECC) meeting that New Delhi has advised the concerned states to start auctioning mines expeditiously “so that the incoming miners have time to take preparatory steps to make the mines functional.” If any proof is needed, this alone is enough to confirm that the administration has no appreciation of the consequences of such a move. In fact, a recommendation of this kind could open a Pandora’s Box and the evils that will come out will be difficult, if not impossible to contain.

The law says: “On the expiry of lease period, the lease shall be put up for auction.” This means the concerned state governments can start the process of auctioning the iron ore and manganese ore mines only after their current leases expire in March 2020. There are other constraints too. According to rule 12 (gg) of the Minerals (other than atomic and hydrocarbon energy) concession rules, 2016 “a lessee is entitled to remove within six months after the expiry of lease period all or any one mineral excavated during the currency of lease, engines, machinery, plant …. and other works.”

Furthermore if a lessee is not able to remove all that is his, he will under the law get an extra one month to do so. The lessee, therefore, has a total of seven months after lease expiry to remove all his stuff, including mineral stocks.

In spite of the protection that current leaseholders enjoy under the law, the prospective bidders, emboldened by state governments, may seek to do due diligence of mines whose leases still have months to expire. An Orissa based mine owner says: “In that event, we most likely will go for legal recourse as due diligence by outsiders will interfere with our day to day operation. All mines stakeholders are living in uncertain times.”

An agitating issue for iron ore mines in Orissa and Jharkhand is the unsold pithead stocks of 127 million tonnes – 85 million tonnes in Orissa and 42 million tonnes in Jharkhand. The stocks are mostly fines of grades with iron (fe) content of up to 62 per cent for which there are no domestic buyers. Yes we can find buyers for the low grade ore abroad, particularly in China provided New Delhi will dispense with 30 per cent export duty on grades of up to 62 per cent fe content. The ill-advised export tax has robbed Indian ore of global competitiveness.

Some miners have made the suggestion that in the unlikely event of auctions going through, the successful bidders (lessees) should be “mandated” to pay to the existing lessees for pithead stocks “on the basis of last ex-mine grade-wise prices published by Indian Bureau of Mines.”  But why should new lessees carry the cross of massive unsold stocks of departing mine owners, specially when demand for fines and low grade iron ore remain low. Will the government then remove the 30 per cent export tax on iron ore with up to 62 per cent fe content to facilitate pithead stock disposal in foreign markets? Export duty removal remains the budget expectation of the Federation of Indian Mineral Industries.

However covetous steel mills here unlike their counterparts in China, Japan and South Korea may be of captive mines, steel producers in eastern India without mines ownership are dreadful of the impending prospect of chaos engulfing the iron ore sector. Remember, working mines in Orissa and Jharkhand meet as much as 45 per cent of iron and manganese ore requirements of the steel industry in eastern India. According to rating agency India Ratings, iron ore production disruption following lease expiry will be around 60 million tonnes a year.