The Supreme Court has stalled Vedanta Group’s bauxite mining project in Niyamgiri Hills of Odisha till gram sabhas of Rayagada and Kalahandi districts give clearance to it.

The apex court directed the gram sabhas of the two districts to decide within three months the issues arising out of the mining project, including that of the tribals residing in the area.

A Bench of justices Aftab Alam, K. S. Radhakrishnan and Ranjan Gogoi also directed the Ministry of Environment and Forests (MoEF) to take action in two months after a report from the gram sabhas is received. The Bench gave the directions on the petition moved by State-owned Orissa Mining Corporation (OMC) challenging MoEF’s decision to cancel the environmental clearance granted to the Niyamgiri Bauxite Mining Project of Sterlite Industries Ltd, the Indian arm of UK-based Vedanta Group.

The Ministry had refused the next stage forest clearance to OMC and Sterlite’s mining project in Niyamgiri Hills area in Lanjigarh, Kalahandi and Rayagada districts, accepting the Forest Advisory Committee’s recommendation for withdrawal of the clearance.

During the proceedings, OMC and Sterlite Industries had claimed that no ecological damage has been caused due to the mining activities in Niyamgiri Hills.

This contention had been opposed by the MoEF and various tribal rights groups which had alleged that the project has violated environmental norms.

The Ministry had submitted before the court that the forest dwellers cannot be evicted from proposed mining sites in Niyamgiri Hills till the “community and individual” rights of residents are decided under the law.

Company reaction

The Supreme Court decision, according to company sources is a positive move towards the revival of the project. “The Supreme Court has now reaffirmed continuation of the project,” said a company source on the condition of anonymity.

There are some issues related with community and individual rights of residents and there is hope that these will be resolved soon, he added.

Vedanta Aluminium had announced closure (stoppage of work) of its alumina refinery at Lanjigarh in Odisha from December 5.

The company has served a formal notice to the Odisha Government. It said that the unit had already incurred financial losses to the tune of more than Rs 2,500 crore and further operation of the refinery was not feasible unless supply of Orissa Bauxite to the refinery is assured.