Why approved projects don’t have social licence to operate

The Tamil Nadu government has announced the permanent closure of the Vedanta copper smelter plant in Thoothukudi after 13 people died in a clash between the police and protesters opposing the project’s operations. People affected by the plant have shown evidence of pollution and other illegalities by the company. The company’s counterargument is that they have a spotless environmental record and that the protest was instigated and motivated.

While the specific details of this tragedy are important to understand, this situation is symbolic of a systemic governance failure. Regulatory decisions prioritise interests of projects and governments facilitate the company’s monopoly over resources. Communities in the project neighbourhood are excluded from all decisions related to their living environment. Such governance creates conflicts by design as they involve a willful denial of impacts, routine inaction against legal non-compliance and rewarding defaulters in the name of facilitating investments. These actions may “settle” the bureaucratic paperwork on projects, but they don’t earn them any legitimacy or what is increasingly regarded as a “social licence to operate”.

Willful denial of impacts

Projects like Vedanta’s smelter have to obtain approvals under various environmental laws. These approval procedures involve assessing of impacts, weighing of costs and benefits and determining trade-offs on the basis of available information. Since the procedures render legal validity to the approved investments, projects routinely engineer approvals by hiding impacts, fudging data and diverting attention to unrealistic mitigation measures. Project assessments are rarely peer reviewed or cross-verified. Expert committees that review these reports have been charged with “non-application of mind” by courts. Approvals based on such flawed studies sanction the most grievous of impacts on communities.

Routine inaction

Once projects are approved, they are nearly impossible to shut down, no matter how bad their performance. Governmental monitoring agencies believe that their role is to “facilitate” development and not to hold it accountable to legal standards. Intensely polluting units are allowed to continue operations for years on end. One usual excuse that institutions responsible for monitoring offer is that they are short of human resources to keep track of projects. That may be true but it is hardly a salve for communities whose children are born into and live in polluted environments. This excuse is also simply a smokescreen in many cases where community members file complaints and make repeated appeals to authorities to make site visits and record instances of legal violations. In these instances, the authorities refuse to take these complaints seriously stating that communities are not “neutral” or may be unduly prejudiced towards the project. They fail to recognise the power and value of communities as monitoring collaborators. In such conditions, protest is often the next logical step for affected people.

Rewarding illegalities

The third and entirely indefensible practice of the government is to reward violating projects. In February 2018, the central environment ministry permitted a coalmine to expand despite its expert committee’s observations about the project’s violations of five critical safeguards. Vedanta Sterlite too was expecting its expansion approval to come through for its Thoothukudi plant and company officials had already made public statements in anticipation. Non-compliance data collected by the panchayats, the pollution control boards, the office of the Comptroller and Auditor General (CAG) seems to have no bearing on government approvals for project expansion.

Since March 2017, the central ministry also has a system in place, which offers a one-time amnesty to projects established without environmental approvals. Over 2,500 projects have already applied for post facto clearance. Projects from Tamil Nadu make up a fourth of this list. They are being routinely reviewed, fined or regularised.

Resource politics

In the light of the shooting and deaths of protestors in Thoothukudi, the media is rife with false arguments of economy over ecology, company jobs versus community health and about being pro or anti development. But this case sits on a heap of many such others that point to a perverse form of resource politics at play.

The above drawbacks in the regulatory process have been known to governments for over two decades yet they have been allowed to persist. This flawed system allows governments to exercise political control over environment regulation by spinning approvals to projects that they favour. Large corporations are willing participants in these subversive practices, as they believe they can game the system. So projects can hardly be worthy of sympathy or support when they face government sanctions that may seem “populist”.

When regulations are turned into political tools and governments are unaccountable for their decisions, the economy and the environment are both in peril. It’s time we stopped asking the wrong questions.

The authors are with the CPR Namati Environment Justice Programme. Views are personal.