History of Sterlite in Thoothukudi: A story of betrayal by crony regulators

On March 24, 2018, tens of thousands of Thoothukudi residents flooded the streets of this south Indian coastal town demanding immediate closure of Vedanta Sterlite's copper operations. The evening public meeting was charged – slogan shouting children; palpable youth energy; colourful dances. A horribly outnumbered police force stood helplessly, and eventually thankfully, as the three-hour long meeting wound up with poise, dignity and no untoward incident.

The wave of opposition, and the intensity of the sentiment on display was not merely against Sterlite, but also against the agents of the state – the district administration, police and the Tamil Nadu Pollution Control Board -- who have done the corporate giant's bidding since the factory was set up in 1998. Many people wrote to me, amazed at how so many people turned up at the public meeting. 

The mechanics of the outreach was central to the mobilisation. The influential Merchants Association's call to all their members to down their shutters for a day was the trigger. Artisanal fisherfolk, shank divers, small salt pan manufacturers, the Tuticorin Chamber of Commerce, auto rickshaw unions, mini bus drivers and tea stall vendors quickly joined the call and stayed off work. They called for an immediate halt of the ongoing work to construct a new copper smelter complex in Therku Veerapandiapuram - a suburban locality west of Tuticorin town, and closure of the existing factory.

If so many people turned up, it is because the organisers were able to effectively mobilise the simmering public anger. To understand why people are angry, though, one needs to look at Sterlite's chequered history and the state's complicity with a serious polluter.

In this story about Thoothukudi's pollution, Sterlite is not the villain in the piece. That dubious distinction is reserved for the Tamil Nadu Pollution Control Board and the Ministry of Environment & Forests, who betrayed the people and failed in their responsibilities as regulators. 

Who is Sterlite?

Known locally as Sterlite, the 1200 tonne per day, 400,000 tonne per year copper smelter complex is run by Sterlite Copper, a business unit of Vedanta Ltd, which is a subsidiary of London-based metals major Vedanta Resources Plc. Its owner Anil Agarwal has made himself a name as a shrewd and aggressive businessman who made his riches from humble beginnings as a scrap dealer from Bihar. In 2017, his net worth was estimated at $3.3 billion (Rs. 21,485 crores). Vedanta specialises in mining and refining non-ferrous metals – copper, zinc and aluminium.

Born into controversy

On July 15, 1993, the District Collector of Ratnagiri sent a letter to Sterlite Industries (India) Ltd asking the company to suspend construction work on the planned smelter. A year-long agitation by local people, fearful of the pollution likely to be caused by the smelter, forced the government to appoint a committee which found that such industries would endanger the region's fragile coastal environment. Read this and this.

Welcome to Tamil Nadu

Within a year, the rejected project had managed to get a foot-hold in Tamil Nadu. On August 1, 1994, the Tamil Nadu Pollution Control Board (TNPCB) issued a No Objection Certificate asking the company to carry out an Environmental Impact Assessment (EIA). Considering the ecological sensitivity of the Gulf of Mannar Biosphere reserve, the NOC carried a condition stipulating that the factory should be located 25 km from the Gulf of Mannar.

However, the Ministry of Environment and Forests seems to have issued an Environmental Clearance on January 16, 1995 without even waiting for the EIA. In fact, a Consent to Establish issued by the TNPCB in May 1995 authorising Sterlite to commence construction includes a condition requiring Sterlite to submit a Rapid EIA. This licence too contained the same setback condition about Gulf of Mannar.

The setback condition was violated, and the plant was built within 14 km of the Gulf of Mannar. Agitation by Thoothukudi residents was met in fair measure by repression from the police and the district administration. 

On October 14, 1996, TNPCB issued the plant a licence to operate, ignoring the violation of its own licence condition on setback from the Gulf of Mannar. The new licence too had conditions, including to develop a greenbelt around 25 metres of the plant and warnings that the licence would be revoked if the factory operations contaminated groundwater or air.

Gas Trouble

Within months of commissioning the plant, public complaints started pouring in, with the District Administration and TNPCB acting in unison to defend the polluter.

On August 20, 1997, staff at Tamil Nadu Electricity Board's sub-station located across the Sterlite factory complained of headache, coughing and choking due to smoke emanating from the plant.

On May 5, 1997, women workers at Ramesh Flowers – a dry flowers manufacturing unit near Sterlite – fell sick and many fainted due to a gas leak form Sterlite. The TNPCB gave the company a clean chit.

Now, it's illegal

In November 1998, acting under directions by the Madras High Court which was hearing a case filed by National Trust for Clean Environment in 1996, the National Environmental Engineering Research Institute (NEERI) submitted a study on Sterlite's pollution. The study found that Sterlite

• had failed to develop a greenbelt;
• was producing products it was not authorised to;
• had contaminated the groundwater with arsenic, lead, selenium, arsenic, aluminium and copper;
• may have tampered with the online air monitors;
• had caused gas leaks that hurt people in Ramesh Flowers and the TNEB office;
• had located itself 14 km from notified islands in the Gulf of Mannar, thereby violating the condition laid out in Consent to Establish.

On November 23, 1998, the factory was closed for the first of many times by the Madras High Court. In what was to become a pattern, the factory remained closed only for a few days.

Now, it's not

On December 1, a week later, the Madras High Court modified its earlier order and allowed the plant to run and asked the Nagpur-based National Environmental Engineering Research Institute (NEERI) to conduct yet another study. This was the beginning of a bonanza for NEERI. Between 1999 and 2007, NEERI received Rs. 1.27 crores worth of contracts for various studies, all of which uniformly defended Sterlite's operations and underplayed its impact.

After having indicted Sterlite on every count in its November 1998 report, NEERI submitted its second report on February 9, 1999, less than 45 days later that gave the plant a clean chit, with recommendations that the factory must be run at full capacity to conduct a Comprehensive Environmental Impact Assessment – a study that ought to have been conducted before the factory was set up. The study, which ought to have taken less than a year to complete, was submitted only in July 2003 allowing Sterlite to run at well past its full capacity in the interim. Where the TNPCB had limited production to 70,000 tonnes per annum, Sterlite manufactured 1,75,242 tonnes of copper anode in 2004.

Gas trouble continued

On March 2, 1999, 11 workers at the All India Radio station near Sterlite complained of distress due to a gas leak and had to be hospitalised. The TNPCB and District Administration once again came to Sterlite's rescue and gave the company a clean chit.

Not only that, the TNPCB permitted Sterlite to nearly double its production from 40,000 tonnes per annum to 70,000 tonnes per annum.

On January 2, 2001, Tuticorin residents complained to TNPCB about the release of toxic wastewater from Sterlite along with rainwater, following the heavy rains on November 21, November 24 and December 12, 2000. Sterlite's arsenic laced wastewater reportedly flooded the Silverpuram, Meelavittan and Kaluthaikuttan tanks.

Fait Accompli

On September 21, 2004, a Supreme Court Monitoring Committee (SCMC) team inspected Sterlite. The team found Sterlite's housekeeping to be shoddy and recommended that environmental clearance for the company's proposed expansion from 391 to 900 tonnes per day (300,000 tonnes per annum) should not be given. It also found that a number of plants that were listed as part of the proposed expansion had already been built. The Committee directed the Pollution Control Board to inspect and take suitable action under the various environmental laws if the company had indeed constructed production units without licences.

On September 22, 2004, within a day of the Committee's inspection, the Ministry of Environment & Forests issued an environmental clearance to Sterlite for plants it had already begun to construct. 

On November 16, 2004, TNPCB submitted its report. It confirmed that the company was engaged in unlicenced production. It had manufactured 1,64,236 tonnes that year against a permitted capacity of 70,000 tonnes. It found that an entire factory complex consisting of copper smelter, refinery, sulphuric acid plant, phosphoric acid plant, converters and continuous cast rod plants were in varying stages of completion. The Sulphuric Acid plant had been completed in August 2004 well before the Environment Clearance was issued and commissioned in October. None of these plants had any construction licence from the TNPCB.

Law makers, law breakers

By law, a plant that has been constructed illegally without a Consent to Establish from the TNPCB cannot be given licence to operate. However, Sterlite appears to have “convinced” the authorities to the contrary. On April 7, 2005, Dr. Indrani Chandrasekaran of the MoEF wrote to TNPCB directing it to issue a licence for Sterlite's expanded capacity. The SCMC too appears to have been compromised, as Dr. Chandrasekaran's letter states that “Chairman, SCMC, has desired that TNPCB may now decide regarding granting of consent for expansion to M/s Sterlite. . .”

The MoEF and SCMC put their necks out (knowing fully well they will not be held to account) to direct TNPCB to break the law and authorise an illegally constructed factory to begin production.

In 2008, the company further expanded its production by milking its 900 tonne per day plant to yield 1,200 tonnes of copper daily. With every increase in production, the corresponding pollution will increase.

The new factory's operations too were chequered as evidenced by the half-hearted and reluctant notices issued by TNPCB asking the company to show cause why it should not be shut down for violation of licence conditions or for pollution.

On September 28, 2010, in the 1996 case filed by National Trust for Clean Environment, V Gopalasamy and others, the Madras High Court ordered the closure of Sterlite's factory citing violations of law and for polluting the environment. 

Like before, the closure was short-lived. On October 1 (three days after the closure order), the Supreme Court rewarded Sterlite by staying the closure order of the Madras High Court. Sterlite was able to continue with its unlicenced production with relief from the Supreme Court. Between October 2010 and April 2013 when the Court delivered its verdict, three workers were killed and several injured in eight hazardous incidents. (See Table below).

Gas Trouble Continued

On March 23, 2013, Thoothukudi town experienced a massive gas leak with people reporting suffocation, coughing, eye irritation, miscarriages and severe discomfort. TNPCB in its characteristic style fiddled while Thoothukudi choked. On March 29, 2013, a closure order was given citing violation of the Air (Prevention and Control of Pollution) Act. Sterlite denied any wrongdoing alleging that toxic gases could have come from any of the numerous other hazardous industries like SPIC, TAC, Kilburn or Tuticorin Thermal. On March 23, 2013, the air pollution measuring equipment on the chimney of Sterlite's Sulphuric Acid Plant – I recorded levels of sulphur dioxide nearly three times the permissible limits.

Around the time of the gas leak (2.15 a.m. to 2.45 a.m.) and the time when people experienced the effects (between 7 and 9 a.m.), the wind was blowing from West Northwest to East South East, according to Meteorological data. Around the same time, the wind speed was 1.22 km/hour. The source of the toxic gases of March 23 would have had to be located Northwest of town. The only industries in the Northwest of town are located in SIPCOT, Milavittan, where Sterlite is located. In fact, Sterlite is located around 6 km Northwest of Tuticorin town centre. At prevailing wind speed and direction, gases leaked from Sterlite or any SIPCOT industry at 2.30 will reach the centre of Tuticorin town by around 7.30 a.m.

This closure lasted longer than the other earlier shutdowns, but was eventually revoked after TNPCB “failed” to establish beyond reasonable doubt that Sterlite was the cause of the gas leak.

Supreme Court's final blow

Meanwhile, on April 2, 2013, the Supreme Court delivered a severe indictment that was illogically followed by a sentencing that appeared to reward Sterlite. The apex court agreed with all allegations made by petitioners and the people of Thoothukudi, but refused to shut down the company. The Supreme Court argued that: “The plant of the appellants contributes substantially to the copper production in India and copper is used in defence, electricity, automobile, construction and infrastructure etc. The plant of the appellants has about 1,300 employees and it also provides employment to large number of people through contractors. . .”

It ordered the company to pay a fine of Rs. 100 crores expecting that amount to be a sufficient deterrent.

Despite the disappointing and shallow conclusion of the judgement, the indictments are unequivocal and worth reproducing:

About pollution:

“The NEERI reports of 1998, 1999, 2003 and 2005 show that the plant of the appellant did pollute the environment through emissions which did not conform to the standards laid down by the TNPCB under the  Air Act and through discharge of effluent which did not conform to the standards laid down by the TNPCB under the Water Act . . .

Unlicenced Operation

“As pointed out by Mr. V. Gopalsamy and Mr. Prakash, on account of some of these deficiencies, TNPCB also did not renew the consent to operate for some periods and yet the appellants continued to operate its plant without such renewal.

Penalty

“For such damages caused to the environment from 1997 to 2012 and for operating the plant without a valid renewal for a fairly long period, the appellant-company obviously is liable to compensate by paying damages. . .

“Considering the magnitude, capacity and prosperity of the appellant-company, we are of the view that the appellant-company should be held liable for a compensation of Rs. 100 crores for having polluted the environment in the vicinity of its plant and for having operated the plant without a renewal of the consents by the TNPCB for a fairly long period and according to us, any less amount, would not have the desired deterrent effect on the appellant-company. The aforesaid amount will be deposited with the Collector of Thoothukudi District, who will invest it in a Fixed Deposit with a Nationalised Bank for a period of five years. The interest therefrom will be spent for improving the environment, including water and soil, of the vicinity of the plant after consultation with TNPCB and approval of the Secretary, Environment, Government of Tamil Nadu. . .

Misrepresentation of Facts

“We now come to the submission of Mr. Prakash that we should not grant relief to the appellants because of misrepresentation and suppression of material facts made in the special leave petition that the appellants have always been running their plant with statutory consents and approvals and misrepresentation and suppression of material facts made in the special leave petition that the plant was closed at the time the special leave petition was moved and a stay order was obtained from this Court on 01.10.2010. There is no doubt that there has been misrepresentation and suppression of material facts made in the special leave petition but to decline relief to the appellants in this case would mean closure of the plant of the appellants.”  

The Supreme Court order sought to be done with the decades of pollution and health problems faced by the residents of Thoothukudi, with Rs. 100 crores deposited by Sterlite with the District Collector. Till date, Sterlite's victims have not been sent even one paisa of benefit from these funds.

Copper smelters the world over are highly polluting. Arsenic, lead, iron, sulphur dioxide and acid gases result in widespread pollution of water and of air with toxic dust particles. Thoothukudi is already a toxic hotspot with a high concentration of polluting and hazardous industries. It is quite likely that the city is already well beyond its environmental carrying capacity. Already, anecdotal reports from local people suggest that Thoothukudi is fast becoming the cancer capital of Tamil Nadu. 

But rather than take steps to mitigate existing pollution, state and district authorities continue to burden Thoothukudi with more and more polluting industries. Sterlite is currently constructing a new 1,200 tonne per day copper smelter. The large, hazardous Red Category plant is coming up within 200 metres of a residential area called Kumareddiyapuram in lands classified as “Dry Agricultural” in the approved village area masterplan of Thoothukudi. This is illegal.

But the district administration which is supposed to enforce the master plan has used the police to threaten and jail villagers who pointed this out. In the event of an untoward incident, lives can be lost. In Kurangani, the government went on a witch-hunt of low-ranking forest officials and bona fide trek organisers charging them with “culpable homicide not amounting to murder.” This charge, which was invoked in the Bhopal gas tragedy applies to acts of omission or commission where the actor takes a decision knowing fully well that the necessary precautions for averting harm are not in place. Locating a hazardous copper smelter next to a residential locality is a recipe for certain disaster. As and when people of Kumareddiapuram die either due to routine pollution or a hazardous incident, will the officials currently sanctioning the project and the chief minister volunteer to face charges of culpable homicide not amounting to murder?

The Environmental Clearance from the Ministry of Environment, Forests and Climate Change was issued on January 1, 2009 by-passing the mandatory public hearing, and Consent to Establish from the TNPCB was obtained in 2017. If this factory is constructed, it will take total production capacity of copper to 800,000 tonnes per year. That will make Sterlite's smelter complex the world's largest smelter complex to come up in an urban centre.

These clearances too have been obtained and given on the basis of false information and misrepresentation of facts. More about this next week. MoEF, Sterlite, TNPCB, the District Administration, the Police have all abandoned the people and are with Sterlite. The people of Thoothukudi have to fend for themselves and that is why they came in large numbers when an opportunity presented itself.

List of Hazardous Incidents involving death or injury of workers and non-workers

Source: Based on interviews by Nityanand Jayaraman with current and ex-workers of SIIL.

Nityanand is a Chennai-based writer and social activist who has been part of the campaign to shut-down Sterlite since 2003. Views expressed are his own.