On February 29, the Supreme Court decided not to interfere with a Madras High Court (August 2020) order that upheld the closure of Sterlite Copper’s Thoothukudi smelter plant on pollution grounds. The order marks an unfortunate end to a 28-year-old saga. The courts could have devised ways to ensure environmental compliance, while keeping the plant running in view of its importance to the industrial economy.

The verdict of the three-member bench led by the Chief Justice of India DY Chandrachud has impacted the livelihood prospects of about two lakh people working across about 1,050 partners of Sterlite. They depended on the plant’s operations before it was shut down on April 9, 2018 by the Tamil Nadu Pollution Control Board (TNPCB), whose own conduct has been called into question in the 2020 Madras High Court judgment. Meanwhile, a deteriorating law and order situation in May 2018 (the police allegedly opened fire on protesters in May 2018, and 13 people died) and politicisation of the issue led to “permanent closure” of the plant. A solution that reconciles economic and environmental considerations would have set a legal precedent.

The Vedanta group, to which Sterlite Copper belongs, is present in pollution-prone but crucial industries such as aluminium, oil and gas and thermal power. The apex court acknowledges that Sterlite “has been contributing to the productive assets of the nation and providing employment and revenue in the area” but says its copper facility invokes three principles — sustainable development, polluter pays principle and public trust doctrine. The last implies that the “State owns natural resources in trust for the benefit of the public”, empowering it to close the factory. The moot point is how the ‘polluter pays’ principle should be enforced. In this case, the asset, a copper smelter, being of national importance, could have been saved, while ensuring that the promoter ‘pays’ for transgressions. This could have included a trial under the relevant provisions — while keeping the plant running with safeguards, with perhaps a different promoter in place. The TNPCB has been unhelpful in compliance. As the Supreme Court notes, there were five grounds on which the Board ordered closure — failure to furnish groundwater examination report, non-removal of slag, not having the license to dispose of hazardous waste, failure to measure emissions and improper maintenance of gypsum ponds. None of these is non-remediable. Indeed, the Board could easily have got these done and been reimbursed by the company.

Copper is critical to the electronics industry. There has been a sharp increase in India’s imports of the metal after Sterlite’s closure in 2018. In April-December 2018, India imports of ‘copper and articles thereof’ were $4 billion; in the same period of 2023, they were $7 billion. The cost of closure has been heavy; much of it could have been mitigated.