Environment ministry slaps Rs 200 crore fine on Adani group

NEW DELHI: The environment ministry has slapped a Rs 200-crore fine on the Adani Group’s Mundra Port and Special Economic Zone for damaging mangroves, creeks and the local environment at the project site. The company’s shares fell 6.4%.

The penalty was recommended by a committee headed by Sunita Narain, director general of Centre for Science and Environment, set up by the environment ministry. The report was submitted to environment minister Jayanthi Natarajan in April. No immediate comment was available from the Adani group. Officials said a part of the project could face suspension after a more detailed investigation into the alleged violation of environmental clearance norms. The money from the fine will go into an environment restoration fund for the area.

The committee reported that the Adani Group violated environmental norms in the country’s largest private port in Mundra and special trade zone that it runs in the Kutch district.

The five-member committee had visited the site, where it found widespread destruction of mangroves--75 hectares of mangroves have been lost in Bocha Island, which was declared as a conservation zone under the environmental clearance conditions.

“The company has not taken precautions to guard against blocking of creeks because of construction activities; satellite imagery shows signs of deterioration and loss of creeks near the proposed North Port. It has not taken stipulated measures to ensure that the channels that bring large volumes of seawater for use in the thermal power plant and then discharge as well as the storage tank is lined so that there is no chance of salinity contamination in groundwater,” the report stated.

The committee charged the company with being been less than serious about reporting on compliance with the conditions set at the time of clearance. “The committee has found that there have been instances to circumvent statutory procedures by using different agencies, at the centre and state, for obtaining clearances for the same project. The public hearing procedure, which is a critical part of project clearance and helps to understand and mitigate the concerns of local people, has also been bypassed on one pretext or another,” said Narain.

This is not the first time that Adani’s Mundra project has run into trouble. In December 2010, the ministry issued notice to Mundra project for violating the Coastal Regulation Zone notification and not meeting the conditions of the environmental clearance. The ministry had said that it would cancel the environmental clearance for the West and North port and the township project, as well as dismantle all reclamations carried out in the mangrove area. The ministry also suggested that Mundra foot the bill for afforestation of an extra 1000 hectares in and around the project site.