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Thursday, 17 December 1992
Page: 5523

(Question No. 2324)


Senator Bourne asked the Minister representing the Minister for Trade and Overseas Development, upon notice, on 23 September 1992:

  With reference to the Piparwar Coal Project in Southern Bihar, India:

  (1) Has the Australian International Development Assistance Bureau (AIDAB) carried out a social or environmental impact analysis of this project; if so, what were the results of this assessment;

  (2) Does the project comply with environmentally sustainable development principles for aid funding;

  (3) What process of consultation was carried out with the local community;

  (4) Will there be a requirement for sections of the local community to be relocated as a result of the project;

  (5) What is AIDAB's assessment of the effect of mining operations to the Damodar River;

  (6) Does the project include provision of funding for the rehabilitation and reforestation at Piparwar.


Senator Gareth Evans —The Minister for Trade and Overseas Development has advised me that the answer to the honourable senator's question is as follows:

  (1) AIDAB is currently preparing a comprehensive review of social and environmental impact mitigation measures taken for the Piparwar coal project. The results will be available shortly. As partners in this undertaking, Australia is also monitoring the project to ensure that our involvement conforms to Indian legislative requirements.

  The Government of India has in place its own environmental control process. The main pieces of environmental legislation which apply to the Piparwar project are the:

  Environment (Protection) Act 1986—to cover all environmental aspects related to water, air and land and their interrelationships;

  Forest (Conservation) Act 1980—to conserve forests and to review use of forested land for other purposes;

  Air (Prevention and Control of Pollution) Act 1981—to prevent and control pollution of ambient air.

  Water (Prevention and Control of Pollution ) Act 1974—to prevent and control pollution of rivers and other water sources.

  In addition, the Government of India has formal procedures for the acquisition of land as well as the determination and payment of compensation to people displaced by land acquired for coal mining projects.

  Under Indian law, all environmental planning and works for the Piparwar project are the responsibility of Coal India Limited.

  As an integral component of the proposed mine development the Australian contractor, White Industries, prepared an environmental management plan as part of its Technical Feasibility Study Report in 1987. This outlined the methods by which the required environmental safeguards for pollution management and land rehabilitation would be incorporated into the proposed mining, coal handling and coal preparation operations. The White Industries plan was incorporated in the formal environmental management plan prepared by the Central Mine Planning and Design Institute (CMPDI—a subsidiary of Coal India Limited), which also covered socio-economic factors (especially displacement of people) as well as environmental monitoring and budget allocations for environmental management and rehabilitation and compensation for displaced persons.

  The Government of India has advised that the relevant subcommittees of the Environment Department have assessed the plan against the requirements of the Environment (Protection) Act 1986 and recommended it for approval.

  CMPDI is monitoring the implementation of the Environmental Management Plan. The Indian Government has advised us that the project is proceeding in accordance with the environmental management plan.

  (2) AIDAB's Interim Policy Statement on Ecologically Sustainable Development recognises that development requires greater energy supplies and that in the short-term most countries in the Asia-Pacific region must be expected to increase their use of fossil fuels to meet increasing energy demands. In these circumstances, the introduction of efficient mining technologies with a high level of attention to environmental protection and rehabilitation is considered critical.

  India is a large developing country with approximately 250 million people living in abject poverty. The World Bank, the International Monetary Fund and other international development agencies all share the Government of India's view that access to adequate supplies of energy will be a key factor during the Eighth Development Plan period (1992—1997). Without adequate supplies of energy it will be very difficult for India to lift its standard of living.

  However, India does not have access to large indigenous supplies of oil. In fact, India's current economic crisis is to a significant degree a result of the need to import oil to meet the needs of industry. India is therefore determined to develop fully its coal resources.

  India's existing coal mines are generally inefficient and highly polluting. India therefore stands to benefit greatly from the Piparwar project which will introduce Australian open-cut coal mining technology. This will significantly improve India's capacity to develop its coal resources with the least possible damage to the environment. The Piparwar mine is, in fact, the first mine in the Karanpura coal fields to incorporate built-in anti-pollution and environment management systems which are compatible with accepted international standards.

  (3) Protracted negotiations with local villagers have been carried out to negotiate the possession of land required for the project.

  Progress on land acquisition and resettlement of displaced persons is being closely monitored including through discussions with all relevant parties. The most recent AIDAB monitoring visit indicated that there is a willingness on the part of village communities to shift to new sites and cooperate with the project. However, outstanding issues which remain to be resolved include compensation and land classification. Given the obvious complexities of the situation there is good progress towards resolution of these issues.

  (4) Five villages are within the project area boundary. Three of these five villages are within the area of mining operations and infrastructure and the approximately 460 families within these villages will need to be progressively relocated.

  The Government of India's compensation program for families displaced by the mine provides for alternative house sites with suitable infrastructural amenities (roads, water supply, electricity, wells and drains), a lump sum grant towards housing costs and a relocation allowance. 300 unskilled or semi-skilled employment opportunities created by the project are reserved for members of families which have been displaced by the mine. Families which are unable to obtain employment in the mine for at least one of their members will receive a subsistence allowance for twenty years.

  (5) The Piparwar project incorporates a comprehensive water management plan similar to that used at the Ulan mine in New South Wales. AIDAB's assessment is that this plan is sufficient to ensure that the effect of mining operations on the Damodar River will be minimal.

  The general principle adopted is containment of water on the site through an extensive closed circuit system. The main features of this plan are:

  the separation of runoff potentially contaminated by mine development from runoff from unaffected areas

  the direction of potentially contaminated runoff to settlement ponds

  the direction of washery wastewater to settlement ponds and the return of settled tailing to the open pit

  the collection and treatment of sewage with final disposal by spray irrigation

  reuse of collected water for site purposes.

  Mining operations will not affect the groundwater system. The area is rocky terrain with weathered rock cover overlying the rock strata and there is not a continuous aquifer. There is local recharge during the monsoon and groundwater levels are seasonably variable.

  (6) The mining method being demonstrated by White Industries involves progressive rehabilitation during mining operations. The mine will be developed as a series of parallel strips with the mined out areas being reclaimed progressively throughout the mining operation. This process includes: removal and stacking of topsoil, clearing of overburden and backfilling in the adjacent mined out area, respreading of topsoil, levelling for planting.

  It is this technology which is being demonstrated to Central Coalfields Limited for subsequent application after White Industries' involvement in the project ceases.

  The Government of India has responsibility for the actual reforestation and has allocated budget resources for this purpose.

  Tree planting has already commenced. A pilot scheme has been undertaken with the Bihar State Forestry Department to determine appropriate species for planting in this area. A model of what the rehabilitated land will look like has been constructed on the site where an area of excavated land has been successfully replanted with local varieties of trees.