Belekeri port scam
Encyclopedia
The Belekeri port scam relates to 3.5 million tons of confiscated iron ore that was exported illegally from Belekeri port near Karwar
in Karnataka
. After Deputy Conservator of Forests R. Gokul seized the ore and the high court refused to permit it to be exported, a large part of it was surreptitiously exported from the port. After persistent protests and public pressure, Karnataka Chief Minister Yeddyurappa, who is balancing political considerations
with control of corruption, admitted to an illegal iron-ore export racket at Belekeri Port involving 35 lakh metric tonnes of iron ore. It is said that the scam was worth an estimated 60,000 crore rupees (US$12 billion).
This iron ore from the Bellary region is alleged to have been illegally mined after paying a minuscule royalty to the government. The major irregularities involve mines in Bellary, including those of Obulapuram Mining Company
owned by G. Karunakara Reddy
and G. Janardhana Reddy
, who are ministers in the Government of Karnataka
. A report constituted by the LokAyukta uncovered major violations and systemic corruption
in mining in Bellary, including in the allowed geography, encroachment of forest land, massive underpayment of state mining royalties relative to the market price of iron ore and systematic starvation of government mining entities.This report was finalized and prepared with inputs from the Income Tax Department's Commissionerate of Central Circle.
Justice N. Santosh Hegde resigned from the Lokayukta
position on 23 June 2010 after an honest officer (Deputy Conservator of Forests R Gokul) was suspended by order of minister J. Krishna Palemar
and he felt powerless to help. He expressed inability to be effective in his anti-corruption mandate owing to a non-cooperative Government of Karnataka. Amid media speculation that the ports minister Krishna Palemar
had recommended Gokul's suspension on behalf of some politicians with business interests, Palemar defended his recommendation to suspend Gokul, saying Gokul had failed to attend a meeting, and "this raised suspicions that he too might have had a role to play in this particular incident. Because of this I recommend that he be placed under suspension".
Hegde's resignation sought to underline the helplessness of the advisory post of the Lokayukta in such situations. The resignation has brought considerable public attention on the scam, whose existence the government has also been forced to admit.
. Overloaded trucks carrying ore have caused hundreds of fatal accidents on the roadways leading to ports such as Belekeri. As many as 114 accidents were reported in 2007, and 174 in 2008. There are also reports of severe damage to the roads in Karnataka, including national highways NH-17, NH-48 and NH-63, near Shimoga.
, Salgaonkar Mining Industries Pvt Ltd and Raj Mahal Silks in large scale illegal exports of ore.
Karwar
Karwar is the administrative headquarters of Uttara Kannada district in Karnataka, India. It is a seaside town situated on the banks of the Kali river which is on the west coast of the Indian peninsula. The town lies about 15 kilometres south of the Karnataka–Goa border and 519 km north-west...
in Karnataka
Karnataka
Karnataka , the land of the Kannadigas, is a state in South West India. It was created on 1 November 1956, with the passing of the States Reorganisation Act and this day is annually celebrated as Karnataka Rajyotsava...
. After Deputy Conservator of Forests R. Gokul seized the ore and the high court refused to permit it to be exported, a large part of it was surreptitiously exported from the port. After persistent protests and public pressure, Karnataka Chief Minister Yeddyurappa, who is balancing political considerations
Politics of Karnataka
The politics of Karnataka is dominated by three major parties, the Indian National Congress, the Janata Dal and the Bharatiya Janata Party. The Government is formed by the Bharatiya Janata Party. The Chief Minister is D. V...
with control of corruption, admitted to an illegal iron-ore export racket at Belekeri Port involving 35 lakh metric tonnes of iron ore. It is said that the scam was worth an estimated 60,000 crore rupees (US$12 billion).
This iron ore from the Bellary region is alleged to have been illegally mined after paying a minuscule royalty to the government. The major irregularities involve mines in Bellary, including those of Obulapuram Mining Company
Obulapuram Mining Company
Obulapuram Mining Company also known as OMC or OMCPL is an iron ore mining company located in Karnataka and Andhra Pradesh in India. The company is owned by the brothers, G. Karunakara Reddy, G. Janardhana Reddy and G. Somashekara Reddy, who were ministers in the Government of Karnataka...
owned by G. Karunakara Reddy
G. Karunakara Reddy
G. Karunakara Reddy is a member of the 14th Lok Sabha of India. He represents the Bellary constituency of Karnataka and is a member of the Bharatiya Janata Party political party....
and G. Janardhana Reddy
G. Janardhana Reddy
Gali Janardhana Reddy is a Indian politician with the Bharatiya Janata Party and one of the richest politicians of Karnataka. He has been implicated in the massive illegal mining scandal in Bellary and the related Belekeri port scam...
, who are ministers in the Government of Karnataka
Government of Karnataka
The Government of Karnataka is a democratically elected body with the Governor as the constitutional head. The Governor who is appointed for a period of five years appoints the Chief Minister and his council of ministers...
. A report constituted by the LokAyukta uncovered major violations and systemic corruption
Systemic corruption
Systemic corruption is corruption which is primarily due to a weaknesses of an organisation or process.It can be contrasted with individual officials or agents who act corruptly within the system....
in mining in Bellary, including in the allowed geography, encroachment of forest land, massive underpayment of state mining royalties relative to the market price of iron ore and systematic starvation of government mining entities.This report was finalized and prepared with inputs from the Income Tax Department's Commissionerate of Central Circle.
Justice N. Santosh Hegde resigned from the Lokayukta
LokAyukta
The Lokayukta is an anti-corruption ombudsman organization in the Indian states.The Administrative Reforms Commission headed by Morarji Desai submitted a special interim report on "Problems of Redressal of Citizen's Grievances' in 1966...
position on 23 June 2010 after an honest officer (Deputy Conservator of Forests R Gokul) was suspended by order of minister J. Krishna Palemar
J. Krishna Palemar
J. Krishna Palemar is a Karnataka politician with the BJP, currently serving as Minister of Environment and Ports in the B. S. Yeddyurappa government....
and he felt powerless to help. He expressed inability to be effective in his anti-corruption mandate owing to a non-cooperative Government of Karnataka. Amid media speculation that the ports minister Krishna Palemar
J. Krishna Palemar
J. Krishna Palemar is a Karnataka politician with the BJP, currently serving as Minister of Environment and Ports in the B. S. Yeddyurappa government....
had recommended Gokul's suspension on behalf of some politicians with business interests, Palemar defended his recommendation to suspend Gokul, saying Gokul had failed to attend a meeting, and "this raised suspicions that he too might have had a role to play in this particular incident. Because of this I recommend that he be placed under suspension".
Hegde's resignation sought to underline the helplessness of the advisory post of the Lokayukta in such situations. The resignation has brought considerable public attention on the scam, whose existence the government has also been forced to admit.
Related road damage, accidents and loss of lives
The lack of effective regulation in the mining and transport of iron ore has adversely impacted road safety in addition to the loss of revenue and environmental denudation due to illegal miningIllegal mining in India
Illegal mining in India is widespread in various ore-rich states of India, and has generated controversy, which spans encroachment of forest areas, underpayment of government royalties, conflict with tribals regarding land-rights...
. Overloaded trucks carrying ore have caused hundreds of fatal accidents on the roadways leading to ports such as Belekeri. As many as 114 accidents were reported in 2007, and 174 in 2008. There are also reports of severe damage to the roads in Karnataka, including national highways NH-17, NH-48 and NH-63, near Shimoga.
Lokayukta Report of July 2011
The chapter 2 of the Lokayukta Report on illegal mining in Karnataka details the method in which the Belekeri Port was the anchor point of export of illegally mined iron ore . The report mentions the involvement of private companies – Shree Mallikarjun Shipping Pvt Ltd (SMSPL), Adani Enterprises LtdAdani Group
The Adani Group is a Gujarat based Indian conglomerate with the industrialist Gautam Adani as its CMD and promoter. The core business of the group is Commodities Trading, edible oil Manufacturing, Mundra port operations and distribution of Natural Gas. Adani group has more than 50 companies under...
, Salgaonkar Mining Industries Pvt Ltd and Raj Mahal Silks in large scale illegal exports of ore.
See also
- Indian political scandals
- Corruption Perceptions IndexCorruption Perceptions IndexSince 1995, Transparency International publishes the Corruption Perceptions Index annually ranking countries "by their perceived levels of corruption, as determined by expert assessments and opinion surveys." The CPI generally defines corruption as "the misuse of public power for private...
- Rent seekingRent seekingIn economics, rent-seeking is an attempt to derive economic rent by manipulating the social or political environment in which economic activities occur, rather than by adding value...
- Jan Lokpal BillJan Lokpal BillThe Jan Lokpal Bill, also referred to as the citizens' ombudsman bill, is a proposed independent anti-corruption law in India. Anti-corruption social activists proposed it as a more effective improvement to the original Lokpal bill, which is currently being proposed by the Government of India.The...