India watchdog blocks Lafarge plant plan

Lafarge’s plans to build a cement plant in the Himalayas have been blocked by India in a further sign of a tougher approach to environmental regulation of major industrial projects by the country.

A tribunal that rules on environment projects reversed last year’s clearance of the plan by the environment ministry.
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The decision, made by the National Environmental Appellate Authority, came just weeks after New Delhi rejected London-listed Vedanta’s plans to mine bauxite from a mountain held sacred by a tribe in the eastern Orissa state.

Jairam Ramesh, India’s environment minister, has expressed a determination to enforce environmental and social protection laws more aggressively.

Enforcement remains erratic, however, due to the weakness and small size of the responsible agencies compared with the vast number of projects. This has fuelled suspicions that politics is influencing decisions on which companies are targeted.

“If I was an industrialist, I would try to be a little more careful because I don’t know when the axe will fall on me,” said Sridhar Ramamurthi, a trustee of the Environics Trust, which works for sustainable community development in environmentally sensitive areas.

Lafarge wants to build an integrated, $187m plant and mine producing 3m tonnes of cement per year in the mountainous state of Himachal Pradesh, which is known for its scenery and horticulture.

The planned project – not far from a plant owned by Ambuja Cement, the Indian subsidiary of Lafarge’s rival Holcim – has been backed by local state legislators and some villagers, who argued it would generate jobs.

The environment ministry approved the plan in June 2009, but opponents appealed against the decision to the NEAA.

In its judgment, made public this week, the NEAA found that Lafarge’s environmental impact assessment report failed accurately to convey the impact the quarry and cement plant would have on natural resources and the livelihoods of local people, especially those who would be displaced by a limestone mine.

Expressing concern about the project’s impact on a wildlife sanctuary just 5km away, the tribunal concluded it was not “desirable” for the area.

Lafarge said it remained committed to the project, which it said had widespread support from a majority of those in the community. “The company is considering the order and will decide on the future course of action soon,” it said.

Himachal is not Lafarge’s first difficulty in India. The Supreme Court in February ordered Bangladeshi subsidiary Lafarge Umium Mining to stop mining limestone in the north-eastern state of Meghalaya, while it considered whether the mining required additional clearances.