Vedanta Case Full

VEDANTAVEDANTA CASECASE

VEDANTA VEDANTA RESOURCESRESOURCES

VEDANTA RESOURCES IS INDIA’S LARGEST VEDANTA RESOURCES IS INDIA’S LARGEST NON FERROUS METALS AND MINING NON FERROUS METALS AND MINING COMPANY BASED ON REVENUESCOMPANY BASED ON REVENUES

WITH ASSETS AND OPERATIONS IN WITH ASSETS AND OPERATIONS IN INDIA,ZAMBIA AND AUSTRALIA, IT IS INDIA,ZAMBIA AND AUSTRALIA, IT IS PRIMARILY ENGAGED IN PRIMARILY ENGAGED IN COPPER,ZINC,ALLUMINIUM AND IRON ORE COPPER,ZINC,ALLUMINIUM AND IRON ORE BUSINESSES.BUSINESSES.

IT WAS FOUNDED IN IT WAS FOUNDED IN 1976,BOMBAY,INDIA.1976,BOMBAY,INDIA.

IT HAS ITS HEADQUARTERS IN IT HAS ITS HEADQUARTERS IN LONDON,UNITED KINGDOM.LONDON,UNITED KINGDOM.

RECENTLY, IT HAS VENTURED INTO RECENTLY, IT HAS VENTURED INTO COMMERCIAL POWER GENERATION COMMERCIAL POWER GENERATION BUSINESS.BUSINESS.

IT IS THE FIRST INDIAN MANUFACTURING IT IS THE FIRST INDIAN MANUFACTURING COMPANY TO BE LISTED ON THE LONDON COMPANY TO BE LISTED ON THE LONDON STOCK EXCHANGESTOCK EXCHANGE

IT IS ON THE TRACK TO BECOME A IT IS ON THE TRACK TO BECOME A MILLION-TONNE PER ANNUM PRODUCER MILLION-TONNE PER ANNUM PRODUCER AT LOWEST DECILE COSTS IN ALUMINIUM AT LOWEST DECILE COSTS IN ALUMINIUM COPPER AND ZINC BY 2010COPPER AND ZINC BY 2010..

IT HAS EXPERIENCED SIGNIFICANT IT HAS EXPERIENCED SIGNIFICANT GROWTH IN RECENT YEARS THROUGH GROWTH IN RECENT YEARS THROUGH VARIOUS EXPANSION PROJECTS FOR VARIOUS EXPANSION PROJECTS FOR COPPER,ZINC AND ALUMINIUM COPPER,ZINC AND ALUMINIUM BUSINESSES AND ACQUISITION OF SESA BUSINESSES AND ACQUISITION OF SESA GOA IN APRIL 2007,WHICH ENABLED IT TO GOA IN APRIL 2007,WHICH ENABLED IT TO ENTER THE IRON ORE BUSINESS.ENTER THE IRON ORE BUSINESS.

REVENUE FROM BUSINESSES REVENUE FROM BUSINESSES INCREASED FROM 3,701.8 MILLION INCREASED FROM 3,701.8 MILLION DOLLARS IN FISCAL 2006 TO 7,930.5 DOLLARS IN FISCAL 2006 TO 7,930.5 MILLION DOLLARS IN FISCAL MILLION DOLLARS IN FISCAL 2010,REPRESENTING A COMPOUND 2010,REPRESENTING A COMPOUND ANNUAL GROWTH RATE OF 21%ANNUAL GROWTH RATE OF 21%

CRITICISMCRITICISM

ENVIRONMENTAENVIRONMENTAL DAMAGEL DAMAGE

Vedanta has been criticised by human rights and Vedanta has been criticised by human rights and activist groups, including activist groups, including Survival InternationalSurvival International and and Amnesty InternationalAmnesty International, due to their , due to their operations in Niyamgiri Hills in operations in Niyamgiri Hills in OrissaOrissa, India that , India that are said to threaten the lives of the are said to threaten the lives of the Dongria KondhDongria Kondh that populate this region. that populate this region.

The Niyamgiri hills are also claimed to be an The Niyamgiri hills are also claimed to be an important wildlife habitat in Eastern Ghats of important wildlife habitat in Eastern Ghats of India.India.

In January 2009, thousands of locals In January 2009, thousands of locals formed a human chain around the formed a human chain around the hill in protest at the plans to start hill in protest at the plans to start bauxite mining in the area.bauxite mining in the area.

Vedanta's Alumina Refinery in Lanjigarh Vedanta's Alumina Refinery in Lanjigarh was critiqued by the Orissa State Pollution was critiqued by the Orissa State Pollution Control Board for air pollution and water Control Board for air pollution and water pollution in the area. pollution in the area.

According to Amnesty International, local According to Amnesty International, local people reported dust from the plant people reported dust from the plant settling on clothes, crops and food. An settling on clothes, crops and food. An environmental impact assessment by the environmental impact assessment by the government found dust pollution was government found dust pollution was within acceptable limits.within acceptable limits.

An environmental inspection of An environmental inspection of the plant reported water the plant reported water pollution by the plant including pollution by the plant including increasing the pH value of the increasing the pH value of the river Vamshadhara below the river Vamshadhara below the refinery.refinery.

In October 2009 it was reported that In October 2009 it was reported that the British Government has criticised the British Government has criticised Vedanta for its treatment of the Vedanta for its treatment of the Dongria Kondh tribe in Orissa, India. Dongria Kondh tribe in Orissa, India. The company refused to co-operate The company refused to co-operate with the British Government and with with the British Government and with an OECD (an OECD (Organisation for Organisation for Economic Co-operation and Economic Co-operation and Development)Development) investigation. investigation.

SAFETY SAFETY CONCERNSCONCERNS

2007 Mining Deaths2007 Mining Deaths

Unsafe mining operations led to Unsafe mining operations led to 1,246 injuries and 26 deaths 1,246 injuries and 26 deaths involving own employees and involving own employees and contractors.contractors.

Balco, Korba, ChhattisgarhBalco, Korba, Chhattisgarh

A chimney under construction by A chimney under construction by Gannon Dunkerley & Company at the Gannon Dunkerley & Company at the Balco smelter in Korba, Chhattisgarh Balco smelter in Korba, Chhattisgarh collapsed on 23 September 2009 collapsed on 23 September 2009 killing at least 40 workers. Balco and killing at least 40 workers. Balco and GDCL management have been GDCL management have been accused of negligence in the accused of negligence in the incident.incident.

LITIGATIONLITIGATION

In respect of bauxite mines at Lanjigarh, In respect of bauxite mines at Lanjigarh, Orissa, public interest litigations were filed in Orissa, public interest litigations were filed in 2004 by Indian non-government organisations 2004 by Indian non-government organisations led by the Peoples Union for Civil Liberties to led by the Peoples Union for Civil Liberties to the Supreme Court sub-committee regarding the Supreme Court sub-committee regarding the potential environmental impact of the the potential environmental impact of the mines. The Ministry of Environment and mines. The Ministry of Environment and Forests received reports from expert Forests received reports from expert organisations and has submitted its organisations and has submitted its recommendations to the Supreme Court. recommendations to the Supreme Court.

The sub-committee has found "blatant The sub-committee has found "blatant violations" of environmental violations" of environmental regulations and grave concerns about regulations and grave concerns about the impact of the Niyamgiri mine on the impact of the Niyamgiri mine on both the environment and the local both the environment and the local tribal population. The committee tribal population. The committee recommended to the Court that mining recommended to the Court that mining in such an ecologically sensitive area in such an ecologically sensitive area should not be permitted.should not be permitted.

CHAIRMAN’S CHAIRMAN’S SAYSAY

Vedanta chairman Anil Agarwal rejected Vedanta chairman Anil Agarwal rejected allegations of maltreatment of locals. allegations of maltreatment of locals. Agarwal said that the mining project at Agarwal said that the mining project at Niyamgiri has been approved by the Indian Niyamgiri has been approved by the Indian Supreme Court based on a process that Supreme Court based on a process that included consultation with the locals carried included consultation with the locals carried out within the bounds of the law, attesting out within the bounds of the law, attesting that the majority of the locals supported that the majority of the locals supported their industrial efforts.[An anonymous their industrial efforts.[An anonymous official of Vedanta Resources blamed the official of Vedanta Resources blamed the NGO's attacking Vedanta of being funded NGO's attacking Vedanta of being funded by competing foreign mining corporations by competing foreign mining corporations

HUMAN RIGHTSHUMAN RIGHTS

The NGO Amnesty International has also The NGO Amnesty International has also come to criticize the company's record on come to criticize the company's record on human rights.It has stated, “IT is clear that human rights.It has stated, “IT is clear that Vedanta Resources and its subsidiaries have Vedanta Resources and its subsidiaries have failed to respect the human rights of the failed to respect the human rights of the people of Lanjigarh and the Niyamgiri Hills.people of Lanjigarh and the Niyamgiri Hills.

" They add, "The proposed bauxite mine " They add, "The proposed bauxite mine threatens the survival of a protected threatens the survival of a protected Indigenous community HIndigenous community H

A four-member panel set up by Government A four-member panel set up by Government of India in the Ministry of Environment and of India in the Ministry of Environment and Forests investigated the bauxite mining Forests investigated the bauxite mining proposal over Niyamgiri . The Committee proposal over Niyamgiri . The Committee submitted their report on 16th August 2010, submitted their report on 16th August 2010, stating "The Vedanta Company has stating "The Vedanta Company has consistently violated the consistently violated the

Forest Conservation Act [FCA], Forest Conservation Act [FCA], the Forest Rights Act [FRA],the Forest Rights Act [FRA], the Environment Protection Act [EPA] and the the Environment Protection Act [EPA] and the Orissa Forest Act.Orissa Forest Act.

LEGAL LEGAL VIOLATIONSVIOLATIONS

In July 2010, Sterlite Industries, a subsidiary In July 2010, Sterlite Industries, a subsidiary of Vedanta Group was slapped a tax notice of of Vedanta Group was slapped a tax notice of about Rs. 324 crore on the company, and about Rs. 324 crore on the company, and charged with violating several rules by the charged with violating several rules by the excise department in India.excise department in India.

On 21st August 2010, the customs and excise On 21st August 2010, the customs and excise department charged Vedanta group's department charged Vedanta group's Tuticorin-based Sterlite Industries (India) Ltd Tuticorin-based Sterlite Industries (India) Ltd for evading duty by mis-declaration of export for evading duty by mis-declaration of export consignment. consignment.