Rio Tinto’s Exit from India: Did Tigers Trump Diamonds?

In the year 2004, Rio Tinto discovered a massive deposit of diamonds in India, one that would catapult the country among the top 10 diamond producers of the world. Over the next decade, the Australian mining giant invested more than $120 million prospecting for diamonds in what was called the Bunder mine (Bunder is Hindi for monkeys, which are abundant in the area). In August last year, however, the company suddenly and unexpectedly announced its exit from the mine, citing the need to ‘conserve cash and cut costs’. Regulatory delays proved to be too much for Rio Tinto, who was repeatedly denied the requisite environmental approvals (Forest Clearances) – the increasing cost of capital was squeezing the profit margins. The mine, in addition to its usual livelihood and environmental impacts, was located in the buffer zone of the celebrated Panna Tiger Reserve and would entail clearing of 971 hectares of tiger corridor and axing of 492,000 trees. In declining approvals to Rio Tinto, prima facie, the Environment Ministry deemed tiger habitat more precious that the diamonds underneath. For once, biodiversity concerns trumped the ‘development rhetoric’. But, did they?


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In 2009, local extinction of tigers in Panna had made headlines. A decade-long cost-intensive programme of re-introduction and conservation resulted in a thriving population of 32 tigers and Panna has since been feted as a rare tiger conservation success story. Although the Bunder mine would have disrupted tiger dispersal and migration in Panna, it’s potential impact dwarfs in comparison to another proposed project, the Ken-Betwa river interlinking which will be a death knell for tigers in Panna.

Ken-Betwa interlinking which has been in the pipeline since the 1980s and has been recently resurrected by the new government, is slated to submerge ten times the tiger habitat as would have been affected by Rio Tinto’s mine. It will completely block the only tiger corridor out of Panna Tiger Reserve, turning it into a virtual island for tigers. The Ken-Betwa interlinking is supposed to bring water to the chronically drought-ravaged Bundelkhand region, a claim questioned by experts. The project is largely being seen as driven by political mileage than by national interest. The only thing it is believed to irrigate is the dwindling political career of a certain politician.

In 2016, both Rio Tinto’s diamond mine and the Ken-Betwa interlinking project were simultaneously vying for forest clearances in Panna Tiger Reserve. The Forest Advisory Committee (the authority that takes decisions on Forest Clearances) deferred Rio Tinto’s Forest Clearance stating “… the project can potentially disrupt landscape character vis a vis tiger dispersal around Panna landscape … this may be taken only when Ken-Betwa (river) interlink is finalised”. Upon submission of a revised proposal, Rio Tinto was asked explore the option of underground mining instead of surface mining. The cost of underground mining would be too prohibitive for the project to make any business sense.  This was the last straw – Rio Tinto decided to not proceed with the mine and handed it over to the state government, which hopes to find new investors for it. Meanwhile, the Ken-Betwa interlinking project is on track to receive the forest clearance.

Environmental approvals are far more complex than being black-and-white conservation vs. development decisions. Real-world environmental decision-making is as much about vote-bank politics as it is about biodiversity. Armed with the development-rhetoric, politics often trumps biodiversity.