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'The Union government is equal party to the mining scam'

July 20, 2010 14:40 IST

The mining scam in Karnataka is keeping Advocate General of Karnataka Ashok Harnahalli busy. The expose of the Rs 2,500 crore-scam has brought many parties at loggerheads -- while the state government and central government have been blaming each other for lack of control, the state government and opposition have been accusing each other of having bigger stakes in the scam.

However, amidst this mudslinging, as Harnahalli pointed out, everybody has overlooked the actual concern -- Karnataka has iron ore resources to last for just another 25 years.

In an interview with's Vicky Nanjappa, Harnahalli speaks out on the spiraling mining scam.

Like the Karnataka governor, you too are a constitutional authority. Do you think Governor H R Bharadwaj has exceeded his brief on the mining issue?

The governor does not have a role in this since there has been no breakdown of law and order. I would not call it exceeding of brief, he has just acted overenthusiastic.

What about the demand for a probe by the Central Bureau of Investigation into the matter? Are you in favour of it?

The opposition in Karnataka should realise that the Union government cannot order a CBI probe suo motu (on its own). There needs to be consent from the state government, and I think there is no need for a CBI probe. Isn't the Lokayukta looking into the matter? Let us wait for this report and then we can see what needs to be done. The state is very serious about tackling this problem and I can vouch for that.

Why is everyone asking for a CBI probe? Don't they have faith in the Lokayukta?

I fail to understand this. Earlier, when he (Lokayukta Justice N Santosh Hegde) put in his papers, the same opposition screamed that the state had lost a good man. All of a sudden they feel that the probe will not be fair. Doesn't that amount to double standards?

However, the opposition has not doubted the integrity of the Lokayukta; it has said that the mining case is a jurisdictional issue since the menace spreads over two states.

More than all this, the important thing is to prevent illegal export of ore out of the state. The Lokayukta is well equipped to take care of that and he will do so. It is too premature to seek a CBI probe at the moment. In case the report by the Lokayukta is adverse in nature or if the issue of boundaries does become a problem, then let us consider a CBI probe. But at the moment it is premature. Precaution is what needs to be taken at the moment.

If the state government is so concerned then why doesn't it ban export of iron ore?

Why is the state government being blamed for this? The state has no powers to ban the export of iron ore, as the power lies with the Union government. The new amendment to the Act seeks a ban on the export of ore for those who get fresh licences. Only the Centre can impose a ban on exports for the existing mine owners.

You asked me why the state was not being serious. You mean to say the Union government is? Why have they not banned the export of ore in Chhattisgarh, where mine owners are looting the natural resources? The Union government is sleeping over this matter in Chhattisgarh and this has given rise to the Naxal movement.

The government allegedly claims a meagre royalty from the mine owners. Why hasn't the state brought about an amendment to this effect to earn more from legal mining?

Royalty is being paid on the sale price. The Indian Bureau of Mines has fixed the royalty at Rs 1,000 per tonne of iron ore, whereas the actual price per tonne is Rs 3,000. Worse, the ore is being sold at Rs 5,000 in the market since there is so much demand. The state government does not have any control over the royalty since it is the job of the Indian Bureau of Mines to fix it and this body comes directly under the purview of the Union government. You see what I mean when I say that the Union government is an equal party to this racket…

Why can't the high court interfere in the matter since both the state and Union governments appear to be doing nothing but blaming each other?

Someone will need to move the court and prove that the problem is really big. If the court is convinced, then it can act provided it feels that this is an extraordinary circumstance.

Going by the statements being issued, nobody seems to be directly involved in mining in Karnataka. If no one has a stake, then who is doing this?

Yes, it is a strange situation. We need to take into account the issue of rising contract and transport contract. Even the Lokayukta has noticed that many who have obtained mining licences do not mine. They either hand it over to some other party due to force or sometimes out of their own will. This is a rising contract, which is illegal and needs to be looked into. If this is not banned immediately, then you will never be able to fix the real culprit. There is also another issue of transport contract, which also needs to be banned. The owner of the lease must mine the area and transport it, and he should not be allowed to hand over the operation to anyone else in the form of a rising or transport contract.

Iron ore has been termed as 'black gold'. Why is the ore so much in demand in the international market?

There is such high demand because there is very little of it available. This is our natural resource and we cannot part with it. We should not sell away our wealth. I will not be able to give a nationwide figure on this, but as per our records Karnataka has a stock of iron ore to last for another 25 years only. After that we will have no option but to beg in the international market.

What is the government doing about the Belgaum issue?

I don't see any issue at all. The Mahajan Commission was very clear that it is a part of Karnataka. We have been given eight weeks time by the Supreme Court to file our reply and we are working on it.

Image: Ashok Harnahalli

Vicky Nanjappa in Bengaluru