Anil Agarwal's Vedanta lobbied to weaken environmental laws: Report

New Delhi: Mining and oil giant Vedanta ran a "covert" lobbying campaign to weaken key environmental regulations during the Covid pandemic, the Organised Crime and Corruption Reporting Project (OCCRP) alleged in a new report.

After coming out with a damning report on Adani group promoters allegedly using proxies to route money in their own shares, the George Soros-funded organisation in a new report said the Indian government approved the changes without public consultation and implemented them using "illegal methods".

"In one case, Vedanta led a push to ensure mining companies could produce up to 50 per cent more without new environmental approvals," it said.

Vedanta's oil business, Cairn India, also successfully lobbied to have public hearings scrapped for exploratory drilling in oil blocks it won in government auctions. Since then, six of Cairn's controversial oil projects in Rajasthan have been approved despite local opposition, it claimed.

Reached for comments, a Vedanta spokesperson said the group "operates with an objective of import substitution by enhancing domestic production in a sustainable manner."

"In view of the same, continuous representations are submitted for consideration to the government in the best interest of national development and India's march towards self-reliance in natural resources," the spokesperson said without refuting the OCCRP report.

In January 2021, Vedanta group founder and chairman Anil Agarwal told the then environment minister Prakash Javadekar that the government could add impetus to India's rapid economic recovery by allowing mining companies to boost production by up to 50 per cent without having to secure new environmental clearances, OCCRP said.

"Apart from immediately boosting production and economic growth, this will generate huge revenue for the government and create massive jobs," Agarwal wrote to Javadekar, recommending that the change could be made with "a simple notification".

Javadekar quickly got to work. "VIMP [Very Important], he scribbled on the letter, directing the secretary of his ministry and the director general of forestry to "discuss [the] policy issue."

Previous industry efforts to push for a similar change had stalled. But this time, Agarwal would get what he wanted, OCCRP said.

"In early 2022, after a series of closed-door meetings, India's environment ministry loosened regulations to allow mining companies to increase production by up to 50 per cent without needing to hold public hearings, which many in the industry considered the most onerous requirement of the environmental clearance process," it said.

OCCRP said it combed through thousands of government documents -- ranging from internal memos and the minutes of closed-door meetings to letters like the one from Agarwal -- obtained using freedom of information requests. "The records show government officials tailored the rules in line with requests made by the industry, and in particular Vedanta," it claimed.

Vedanta's subsidiary Cairn Oil & Gas also lobbied to scrap public hearings for oil exploration projects. "As with mining, the government quietly amended the law with no public consultation. Since then, at least six of Cairn's oil projects in the northern deserts of Rajasthan have been greenlit for development."

"Though Vedanta lobbied hard for the pandemic-era changes to India's environmental regulations, it's hard to say whether Modi's government was acting specifically to benefit the company, as other companies also stood to benefit," OCCRP said.

It went on to state that it found evidence that Vedanta has been an important donor to Modi's BJP party. "Two entities linked to a Vedanta subsidiary gave a combined Rs 43.5 crore to the party between 2016 and 2020, according to contribution reports filed with India's election commission by the BJP and one of the entities."

The donations from just one of these trusts, Bhadram Janhit Shalika, put it in the top ten donors to the BJP between the fiscal years 2016-2017 and 2021-22, according to data compiled by the Association for Democratic Reforms, an Indian advocacy group.

"The true amount could be far more because Vedanta has also made political donations through 'electoral bonds' -- an opaque method using bank promissory notes brought in by the BJP-led government in 2018. Between 2021 and 2023, Vedanta's annual reports show it bought more than USD 35 million of these bonds though it's unclear how much, if any, of this may have gone to Modi's party," OCCRP said.