Is CCI a bypass lane for the laws?

In January 2013, India's cabinet approved the setting up of a Cabinet Committee on Investments (CCI). The justification for it emerged from Finance Minister P Chidambaram's proposal for setting up a National Investment Board (NIB) and the CCI sought to intervene in instances where different approval processes, particularly those related to the environment, were thought to be impeding the economic growth of the country.

The powers and functions of the CCI are explicit in its notification under the Government of India (Transaction of Business Rules), 1961. Under the chairpersonship of the country's Prime Minister, this body today enjoys a range of powers, starting with those related to identifying key industrial and infrastructure projects of Rs. 1000 crore or more and any other "critical" projects which would need to be implemented in a time-bound manner. It also prescribes time limits for approvals taken by various Ministries and Departments, regularly monitoring progress with respect to identified projects.

The CCI also has powers to review decisions taken by relevant ministries where projects have been refused approval or there are "undue" delays. The CCI can today direct "statutory authorities to discharge function and exercise powers under the relevant law/regulation within the prescribed time frames for promoting investment and economic growth."

Limited understanding

A closer look at some of the discussions and decisions of the CCI gives us a clearer picture of how environment and forest laws of the country are being brushed aside and rendered ineffective through discharge of the powers and functions of the body. To quote an example, minutes from the meeting of the committee, available online at this link, state: "The Cabinet Committee on Investment, in its meeting held on 23.5.2013, also reviewed the progress made in resolution of bottlenecks in implementation of Highway project. It was noted that the following bottlenecks have been resolved..."

The above-mentioned decision went on to clarify that the bottlenecks for highway projects have been resolved by de-linking environment clearance (issued under the Environment Impact Assessment Notification, 2006) from forest clearances (approved through the Forest Conservation Act, 1980 procedures). Thanks to such a resolution, construction of highway projects under the National Highways Authority of India (NHAI) could be started without waiting for the diversion of forest land for such non-forest use.

The premise of this decision is both legally faulty and detrimental from a socio-ecological perspective. It has been argued for a long time that highway projects should seek approval not just for individual segments, but try and understand the cumulative impact that such construction would have on the people and environment of an area. Even if one were to keep this aside for now and concentrate on the CCI's resolution and what they have considered as bottlenecks, it goes on to completely undermine the logic under which project authorities were originally restrained from starting construction on non-forest land, in projects that also involved use of forest land.

This issue was sought to be addressed in Section 4.4 of the Guidelines of the Forest Conservation Act (FCA). To quote, "Some projects involve use of forest land as well as non-forest lands. State Governments/Project Authorities sometimes start work on non-forest land in anticipation of the approval of the Central Government for the release of forest land required for the project. Though the provisions of the Act may not be technically violated by starting work on non-forest land, expenditure incurred on works in the non-forest land may prove to be infructuous if diversion of forest land is not approved. It has therefore been decided that if a project involves forest as well as non-forest land, work should not be started on non-forest land till the approval of the Central Government for the release of forest land under the Act has been given."

As noted in the Guidelines, industrial and infrastructure projects often need land in both forest and non-forest areas for construction of main and ancillary activities. However, more often than not, project authorities initiate construction activity on non-forest land even while forest clearance is pending and eventually, the investment in construction activity becomes the reason for expediting the forest diversion proposals. The CCI, assuming that forest clearances will eventually be granted, pushes ahead for NHAI projects leaving little scope for the relevant ministry to reject the use of forest land.

This is exactly the kind of decision and understanding of the CCI that had been objected to by Jayanthi Natarajan, the Union Minister of Environment and Forests (MoEF). In a very strongly worded letter to the Prime Minister on 8 October 2012, Natarajan had opposed any move akin to the setting up of a CCI-like body (called the National Investment Board then) which would allow bypassing of approvals administered by the MoEF.

The letter had emphasised that it is domain knowledge which is important to decide whether a project is environmentally feasible or not, or if forest land can be given for mining, industry or related infrastructure. The environment minister also raised a critical question on the overriding of a minister.s authority and substituting it by another one. The letter said, "When the Minister of a Ministry, acting upon the expert advice of officers, takes a decision, there is absolutely no justification for an NIB to assume his/her authority, nor will the NIB, have the competence to do so."

Another legal procedure which directly affects the jurisdiction of the Ministry of Tribal Affairs and the MoEF was also pushed through by the CCI; this relates to the decision of the MoEF to dilute its circular/guidelines dated 3 August 2009, which mandated that the process of recognition of rights under the Scheduled Tribes and Other Traditional Forest Dwellers (Recognition of Forest Rights) Act, 2006 (FRA) is to be completed prior to any forestland being diverted for non-forest use under the Forest Conservation Act (FCA). A particular requirement under this circular was the consent of the gram sabha (village assembly) from where forestland is being diverted.

In an earlier meeting of the CCI in March, a set of decisions were taken which again rendered the environment regulatory process for several individual and categories of projects useless. Minutes of the CCI meeting in March 2013 reveal that the committee was of the opinion that "A number of projects were getting delayed as obtaining consent of each Gram Sabha is time consuming."

It was also recorded that the committee had been informed in the meeting that an Office Memorandum (OM) had been issued on 5 February, 2013 by the MoEF whereby linear projects such as roads, pipelines, transmission lines which pass through several villages would now be exempt from obtaining gram sabha (village assembly) consent. What this myopic view of such projects failed to take into account was the fact that almost all of these projects, especially pipelines and transmission lines, are invariably linked to some industrial or power generation project right from the stage of project design. It is just that project authorities almost always attempt to break these components and seek separate approval.

It was reported in the media that the suggestion for granting exemption to linear projects came from the Prime Minister's Office (PMO). K C Deo, Minister of Tribal Affairs and Jayanthi Natarajan, Minister of Environment and Forests (MoEF) vehemently disagreed with any proposed dilution of the FRA. From December 2012 to January 2013, there were several sit-ins to "discuss" the deadlock between ministries. The PMO, whose head also chairs the CCI, eventually won.

A body supreme

Several recent directions emerging from the MoEF are in fact those which are directed by the CCI. For instance, it is the CCI which suggested that coal mining projects having a one time capacity expansion of 25 per cent or less can be exempt from the mandatory public hearing under the EIA notification, 2006, if the lease area remains the same. The MoEF informed the CCI in its March 2013 meeting that an OM was issued to this effect on 19 December, 2012, The CCI has also recommended that no fresh environment clearance be required for mining projects at the time of renewal of the mining lease.

The web page of the CCI today lists 332 projects where "where all issues are resolved". Many of these projects include highly contested projects in the country, including the Multi-product Special Economic Zone at Mundra, Adani Ports and Special Economic Zone Ltd in Gujarat, expansion of the Vedanta Aluminium Limited Alumina Refinery in Odisha, Mahan coal block (of Essar and Hindalco) in Madhya Pradesh, expansion of Reliance's Sasan UMPP in Madhya Pradesh, OPG Power's air cooled power plant in Gujarat, Stage II pit-head Coal-Based Thermal Power Plant at Tamnar Chhattisgarh, the Navi Mumbai Special Economic Zone and several others.

Where does this leave the regulatory decision-making around environment and forests today? The CCI has no patience for process, be it to ensure regulation or seeking consent. With all this considered too time- consuming, the wisdom of this inter-ministerial body comprised of 15 current heads of the the ministry of defence, power, coal, finance, mines, railways and so on, is successfully rolling over the thin pieces of regulation that other ministries mandate or seek to implement. Today, we have a government which is at odds with itself.