Citizens' Issues
Government loses crores of rupees worth of royalty from quarrying; international traders rake it in

An RTI query has revealed that Pune has no record of royalty from quarrying, that has caused loss of at least Rs2,000 crore. Global traders are selling precious mineral stones from quarries across Maharashtra—each miniature costing between $300-$3,000

Pune city leads in construction activity in the country and the 698 quarries in the district is an apt reflection of it. Being tucked in the basin, Pune is surrounded with hills which have become prime targets not only for indiscriminate and illegal quarrying (there are nearly 300 quarries operating, though the validity of their license is over) but also for alleged illegal sale of rare and exquisite mineral stones found in the quarrying sites particularly that of the Wagholi and Pashan neighbourhood of Pune. These are openly sold through Internet sites across the world: (, being a couple of leading sites.
While other countries are extremely strict about quarrying rules and regulations, the example of Pune portrays the complete disregard to this aspect which also has serious environmental repercussions besides indiscriminate looting of natural mineral wealth-this despite the fact that the Maharashtra Pollution Control Board (MPCB) has laid down stringent guidelines in December 2006.

 In the State of Maine, USA for example, besides strict mining laws (quarrying comes under it), site states that, ``in addition to the general land-use regulations restricting activities that impact such areas as wetlands, beaches, dunes, water bodies, significant wildlife habitat, or other environmentally sensitive areas, there are specific Maine statutes and rules about excavation, mining, and quarrying.'' These include the limited permission for quantity of quarrying, groundwater protection, natural buffer strips for protected natural resources, erosion and sedimentation control, surface water protection and storm water management, noise, dust control etc.
Right to Information activist Vijay Kumbhar was exploring the idea of suggesting to the Pune Municipal Corporation (PMC), the idea of using abandoned quarries for landfill sites for the disposal of the city's garbage. For this, he conducted inspection of files under Section (4) of the RTI Act to find out the number of quarries- working and abandoned-in and around Pune and those that have been abandoned. To his utter shock, Sanjay Bamne, the mining officer in the Collector's office specially appointed to govern the quarrying operations in the district, declined information. He then filed a complaint at the Information Commission, Pune division which ordered him to make the information public.

Mr Kumbhar also sent a letter to the Collector of Pune stating that
"[A] vast number of illegal quarrying and excavation is going on in and around Pune. Large number of hills, mountains and lands are being excavated without any necessary permission. Actually all such permissions and extensions to them fall under Section (4) of the RTI Act and administration is bound by it to disseminate such information. However, when I went to the district administration for inspection of such documents, the officer didn't show me any document. Then I filed a complaint with the State Information Commission and have also filed an application under the RTI Act.
"In Wagholi, around 10 to 12 kilometres of area is being excavated for quarrying. Each quarry depth is around more than 100 metres. These quarries are visible from satellites also. Most of these quarries are running illegally.

"In Ghotawade near Paud, the Sahyadri Hills are being excavated, Katraj hill in Pune has already been destroyed.

"Pollution related norms/conditions have not been followed by any of the above. (I tried to find some information on the MPCB website, but it was updated long back on 1 September 2009).

"I don't say that every instance of digging or excavation is illegal, but if these activities are legal, why is the district administration hiding the information? What is the harm in disseminating information about how many of those are legal? Have they taken all the necessary permissions? How much royalty they have paid? Actually, all this information must be seen on the website.

"I hope you will take serious note of this letter and ask the district administration to disseminate the necessary information and take action on the illegal quarries and excavations." Thereafter, the Collector of Pune has ordered the survey of quarrying activities in Pune district.

Kumbhar states that, "I would never have known there is a scandal in this issue if the officer had supplied me the basic information of the number of abandoned quarries. The fact that he was avoiding information set me thinking about other aspects of mining rules. I found out that the excavator has to pay royalty charges to the district administration for quarrying purposes."  

When subsequently the officer supplied information to Mr Kumbhar, it was revealed that 2,500 acres of area in Pune district is used for quarrying—which is equal to 10 crore sq ft of area. When this is multiplied by 200 per sq ft i.e., the depth of the quarry, it amounts to Rs20 crore brass. For each brass, the excavator has to pay Rs100 as royalty to the government that amounts to Rs2,000 crore—the amount of royalty so far that has not been collected by the revenue department. When he asked the officer to show the royalty payment record, he confessed that they do not keep any such records. This is but the tip of the iceberg as quarrying operations are in full swing across the length and breadth of Maharashtra. He has asked for state level information.

The district Collector's office also has no record of the blatant illegal international sale of precious mineral stones acquired from quarrying sites (mostly in Pune district) if the website is to be believed. Mining officer Mr Bamne states that the excavator must report any such mineral stones found there, but confessed that no one has approached him so far. In the meanwhile, international traders have found rare and exquisite treasure in Wagholi and Pashan of Pune, Lonavala, Narayangaon and Jalgaon.

Following is a shocking example from the website

"IND-64 (code of the mineral stone), Carvansite (name of the mineral stone) 'the burning bush'-$3000. Wagholi quarry, near Poona, Maharashtra, India. Miniature: 38 x 3.6 x 2.1 cm.'' Now, read its description as stated in the website which will give you an idea of how precious the stone is: "This is a single rosette composed of individual radiating crystals of cavansite. It exhibits an intense royal blue and is both lustrous and translucent. Aside from the very, very neat form of it, it is one of the finest canvansites for quality I have handled in 10 years and simply one of the most gorgeous of all. Competition, quality miniature this. Not just another representative example you could beat with more money. I have literally seen thousands of these things so believe me I do not rave carelessly on this.''

This website gives stunning photographs of 92 such specimens procured from Wagholi in Pune and Jalgaon. The seller's name is Rob Lavinsky. He has described practically every mineral stone with fantastic photographs, praising the high quality of mineral stones present in Maharashtra and priced them between $300 and $3000- some of them have been sold online!

While entrepreneurs across the world are looting our natural mineral treasures, the district administration is blissfully unaware of this daylight robbery. The mining officer agrees that findings of mineral stones should be reported to him but no one has done so far, at least it is not in the records.

This is a small example of the larger picture across the country where the wealth of mineral stones is being siphoned off by global commercial interests, thanks to lack of governance and passion to save this precious wealth by the relevant government bodies. It is a strong case for the Ministry of Environment and Forests to intervene in the matter and put a full stop to the brazen loot.{break}
These are the guidelines for environmentally sound operations for stone quarries:

Maharashtra Pollution Control Board:
The stone mining areas are generally identified by the mining department and the Collector, through the mining department regulates the operation of stone quarries. The operations of the quarries have operations including blasting (but):
1. No quarrying operations shall be carried out without obtaining Development Permission of the Planning Authority/District Collector/ Sub- Divisional Officer/Tehsildar
2. The application for Development Permission for quarrying shall
include: a. A Location/site Plan at 1:500 scale of the quarry site and an area up to 500 meters around the quarry site showing important natural and manmade features and contours and other important landscape features, access roads, buildings and other structures;

b. Proposed excavation plan and cross-sections at 1:500 or larger scale showing proposed phasing; terracing; stepping; benching slopes; locations of process equipments; diversion of water courses; impounding lakes; storage areas for topsoil, waste material, quarried material; workers' housing; landscaping including screen planting, mounding and measures against visual intrusion etc.

c. A restoration plan including landscaping proposals, phasing and proposal for reuse of the area after quarrying.

d. A report supplementing the excavation and restoration plans, costs and implementation programme.

3. No quarrying shall commence until the excavation plan is approved by the Director of Geology and Mining.

4. The Restoration Plan approved by the Planning Authority/District Collector/Sub-Divisional Officer/Tehsildar shall be implemented in consultation with the concerned Conservator of Forest of District Forests Officer.

5. Natural gradient of slope should be maintained during quarrying operations, slope of the footwall side (Slope in the direction in which mining does not exist) should be properly stabilised by planting adequate number of tress of suitable species in consultation with (the) local Forests Department so as to have soil-binding vegetation.

6. In the case of murrum, the entire weathered soil or murrum shall not be excavated leading to exposure of hard rock, instead, a capping or at least half-a-meter layer of murrum shall be left so that it can support vegetation and plantation that will be done later on.

7. Water course, if any, from a higher slope, should be properly diverted out of the quarry and shall be safely channelled out of any nearby human settlement.

8. During quarrying operations, the water should be sprayed at least once in a day over the roads at the quarry sites and nearby areas.

9. A kachha road, used for transportation of murrum, from the quarry site shall be invariably sprayed by water during these operations. In order to minimise dust pollution, measures such as adoption of hoods at transfer points, vulcanising of conveyer belt joints, under belt-cleaning devices, and installation of dust suppressions and/or dust extraction system for conveyance shall be adopted.

10. The kachha road leading to the quarry shall have avenue plantation to arrest dust pollution.

11. No blasting shall be permitted if a public road, railway line or any human settlement is located within 500 meters from the quarrying site.

12. Residences for labourers and related temporary structures should be constructed at least 500 meters away form the place of blasting as well as from the place of quarrying. Heavy blasting using heavy machinery shall be prohibited.

13. The Development Permission for quarrying shall be granted for a specific period, after which fresh permission for further quarrying will be necessary. In granting such fresh permission, the Planning Authority/District Collector/Sub-Divisional Officer/Tehsildar shall review the performance of the quarry operator in implementing the approved excavation and restoration plans, air pollution control measures undertaken and adherence of these guidelines while carrying out the quarrying operations.

Control measures to be followed for stone quarries:


1) The drilling machine shall be fitted with dust suppression, collection and disposal arrangement.

2) Deep wetting of drilling zones shall be done by water sprinkling before starting drilling.

3) During the drilling operations, the efforts shall be made to reduce dust generation by taking appropriate measures


1) (For) proper blasting, whole geometry shall be designed.

2) Blast site will be wetted before and after blasting operations are completed.

3)  Only optimum quantity of permissible explosives shall be used so that the vibrations do not damage the structures/houses if the quarrying operations are close to human habitation.

4) Blasting shall be conducted only during favourable weather conditions and only during the daytime and permissible hours.

5) The blasting operations shall be given publicity in the local area through davandi and other available media so that local people become aware of the blasting activities being undertaken in the area.

6) The vibrations should be monitored periodically in consultation with local mining authorities.

7) The storage of the explosives and its transfer to and from the quarry area shall be strictly in accordance with the conditions listed in the permission granted by the Explosives Department.

Heavy Earth moving Machinery (HEMM):

1) The operator/transporter shall carry out regular maintenance of the machinery and vehicles.
2) The speed limit shall be adhered to.
3)  The operator's cabin of the HEMMs should preferably be
air-conditioned or at least airtight.
4) The smoke emission should conform to the standards notified under the Motor Vehicles Act.
5) The trucks carrying the mined products shall be covered with tarpaulin so that there are no fugitive emissions during transportation.
6) The transportation should not go through busy roads in city/towns/villages if bypass roads are available.  

Bombay Minor Mineral Extraction Rules:

"According to the "Bombay Minor Mineral Extraction Rules, 1955," it says that quarry operators are required to follow and can be heavily fined for not observing these rules. They shall not carry on or allow to be carried any mining operation at any point within a distance of 50 yards if no blasting is involved, from the boundary of a railway line or reservoirs or public works or buildings, except with permission of the government. Shall see that the hole (where the blasting is performed) is muffled with an iron sheet with a weight of about 12 of more bags of sand on it. Before starting the blasting, give warning to the public by an efficient system of signals and by putting red flags in danger zones, namely 200 yards from blasting (site). Shall warn the public not to approach the quarry within half an hour after explosion.''

(Vinita Deshmukh is a senior editor, author and convener of Pune Metro Jagruti Abhiyaan. She can be reached at [email protected].)




6 years ago

What right has the Congress to critisize the BJP administration in Karnataka on illegal mining? They are turning a blind eye to what is happening in their own backyard. In earlier centuries the Britishers and Moghuls looted us - now our own politicians are continuing the loot.



In Reply to B V KRISHNAN 6 years ago

That is how political parties want us to think. Every time there is a debate - turn it into clash of political parties. Fact is both are on the wrong side, but the discussion will surely get sidelined and that is good for these thugs.


6 years ago

It is a national ashame and if you ask the govt. one of the jalras of the govt. just like KABIL SIBAL , they will tell that the news is spread by the opposition party to destabilise the country.

Pravinkumar Padwalkar

6 years ago

Very well studied & presented article. Hats off to Mr.Kumbhar, Ms.Deshmukh & ofcourse to you for publishing this.There is a minister who is rulling Navi Mumbai & having quarries along the Thane Belapur road, devasted entire hilly area flouting all norms & regulations for years.Unfortunately this has not been taken up like Karnataka mining operations & Lavasa case.


6 years ago

NAC gave us the path breaking RTI ACTwhich was erhaps the best piece of legislation we got in a long long time. Now please give us a strong legal framework to take the info thru RTI and put it to its logical end. I believe mr moily has set in process themuch needed judicial revamp. That willbe very welcome. We hve to get the guilty to book without creating instability. As instability and chaos are thier fodder.


6 years ago

Now who are the real terrorists?

sanjay doshi

6 years ago

around 10 years ago I was going to Chhindwara in Madhya Pradesh, by car, and was surprised to see red colour soil on either side of the road. On inquiring with the driver I was told that there were huge deposits of iron ore and that most of it was being illegally mined. Who cares !

Nitin Kirtane

6 years ago

it is sad that our natural wealth like quarries is wasted and foreigners taking undue advantage of this , Why do not we have strict mining laws like america , our government is losing out a lot , good work by mr kumbhar , an unbeleivable article by mrs deshmukh to take up this serious issue , we need good social activists like you , keep up the excellent writing

vijay kumbhar

6 years ago

Thanks for the complements , This is happening not only in Pune but all over India, local activists must obtain information about it and pursue the matter with respective governments.


6 years ago

Thank you for this, very apt and timely, and congratulations to Vijay Kumbhar on his fortitude and resoluteness. Matters are even worse in the Hampi area, where the whole area is being sold, rock by rock - including rock structures dating back 1000 years and more.

Indian stocks to open sideways: Wednesday Market Preview

Fears of the European debt crisis spreading has made investors jittery

The Indian stock market is likely to open sideways on mixed global cues. Moody’s downgrade of Ireland’s credit rating to junk resulted in Wall Street finishing trade lower on Tuesday, in the red for the third day in a row. However, showing some resilience the  Asian pack opened in the green on Wednesday on bargain hunting after recent losses in the market, which made stocks cheaper. The SGX Nifty was 16 points higher at 5,542 compared to its previous close of 5,526.

The domestic market was severely mauled yesterday by the deepening Euro debt crisis and a couple of negative domestic factors such as poor Infosys results and a decline in the manufacturing index. After opening lower, the indices were knocked down through the day and lost more than 1.5% by the close of trading. Earlier, the Sensex opened 187 points down at 18,534, while the Nifty opened at 5,557, lower by 59 points from its previous close.

The drop in the indices was worsened by the first quarter results of Infosys that were below expectations. Slower-than-expected industrial output numbers for May that were announced around noon, dampened sentiments further. Industrial output, measured by the Index of Industrial Production (IIP) rose by just 5.6% from a year earlier. April's industrial output growth was also revised downwards to 5.8% from the earlier 6.3%, the government said. The growth in April-May was just 5.7% compared to 10.8% a year ago.

The weak market appeared to revive briefly on the news of the much-awaited Cabinet reshuffle, a little before noon. At about this time, the indices hit their intra day high, the Sensex at 18,589 and the Nifty at 5,580.

The market did not revive after that and as the European markets re-opened weak, the Sensex hit an intra-day low at 18,326 and the Nifty fell back to 5,497. At the close the Sensex had lost 310 points to 18,412 and the Nifty 90 points to 5,526.

On Monday, we mentioned that the Nifty may find support at 5,525. Yesterday, the Nifty broke this support but ended above it. We could see a pullback rally, subject to global events.

The fears of the European debt crisis spreading to Italy and Spain after Moody’s Investor Services downgraded Ireland’s credit rating to junk territory had investors and policymakers worried. The ratings agency said that Ireland will need more funds before it can return to capital markets. Earlier US indices were in the green after minutes of the 21st-22nd June Federal Open Markets Committee meeting suggested that there was still space for more stimulus to boost the economy.

IT stocks Novellus Systems fell 4.02 and Microchip Technology plunged 12% after they provided weak earnings outlooks late Monday.

In economic news, US trade deficit surged in May to its highest level in more than two-and-half years. Also, farm-machinery stocks slid after the US Department of Agriculture trimmed its consumption outlook for corn this year, while raising corn-production forecasts.

The Dow declined 58.88 points (0.47%) to settle at 12,446.88. The S&P 500 shed 5.85 points (0.44%) at 1,313.64 and the Nasdaq fell 20.71 points (0.74%)at 2,781.91.

Markets in Asia were up in early trade on Wednesday as data that just came in suggested that the Chinese GDP stood at 9.5% in the second quarter from 9.7% in the year-ago period. However, European worries kept investors on their guard.

The Shanghai Composite gained 0.69%, the Hang Seng surged 0.92%, the Jakarta Composite climbed 0.59%, the Nikkei 225 added 0.01%, the Straits Times gained 0.27%, the Seoul Composite was 0.46% higher and the Taiwan Weighted rose 0.44%. On the other hand, the KLSE Composite slipped marginally into the red down 0.01% in early trade.

Back home, a meeting of the Empowered Group of Ministers (EGoM) headed by finance minister Pranab Mukherjee to consider limiting supply of subsidised domestic LPG cylinders to 4-6 per household in a year, has been deferred. The EGoM meeting was slated for 1630 hours on Tuesday but had to be deferred due to the Cabinet reshuffle.

The panel was to consider recommendation of the Task Force on Direct Transfer of Subsidies on Kerosene, LPG and Fertiliser.


DGH, RIL reply to CAG issues on KG-D6 field

Sector regulator says production sharing contract allows companies to revise plans, costs

Reliance Industries (RIL) as well as the oil ministry and sector regulator, the Directorate General of Hydrocarbons (DGH) today gave a detailed point-by-point reply to the observations of the Comptroller and Auditor General (CAG) on the country's largest gas field, KG-D6.

Besides Reliance, Cairn India and the UK's BG Group have also replied to audit observations on the Rajasthan oilfields and the Panna/Mukta and Tapti fields, respectively, at the Exit Conference called by the CAG before it finalises its report, PTI quoted sources privy to the meetings as saying.

DGH director-general SK Srivastava in a separate session with the CAG said the production sharing contract (PSC) allowed companies to revise costs and plans for developing oil and gas finds. This is by incorporating new inputs like the one done by Reliance for its KG-D6 fields where costs went up from $2.4 billion initially, to $8.8 billion, in two phases ($5.2 billion in phase-1 and $3.6 billion in phase-II).

The initial cost produced in 2004 was for producing a maximum of 40 million standard cubic metres per day (mmscmd), but in the revised plans Reliance doubled output to 80 mmscmd. "Financial estimates were best estimates at that point of time for the broad work programme considered in development plan and were used for techno economic evaluation only," DGH said.

The CAG had in its draft report accused the oil ministry and the DGH of turning a blind eye to the cost increase which would lower the government's profit take from the field.

Sources said that the DGH disagreed with CAG's assumption of adverse impact on government's financial take from the project, saying "cost for the purpose of computation of government take is determined based on actual expenditure incurred and duly validated by audit, and is not based on development plan estimates".

"Any expenditure qualified by audit will be disallowed as contract cost," it said, and added that RIL's actual expenditure on phase-1 of KG-D6 gas field development was $5.6 billion till March 2011. The second phase of drilling is scheduled to commence shortly.

A Reliance team headed by its executive director PMS Prasad pointed out that "the draft CAG report had found nothing to suggest that Reliance indulged in gold-plating, that is Reliance placed orders on its own affiliates at inflated costs or that payments made to vendors came back to Reliance."

According to sources, RIL stated that "using the benefit of hindsight, CAG cannot question the technical and operational judgements of the operator that were in effect the best possible judgements at that time, based on the best information available. Benchmarking the project with similar ones the world over validates the fact that KG-D6 remains the most cost-effective project."

Reliance said there was "no malafide intent" on its part in making any "economic, commercial or operational decisions". The company said "reasonableness of costs incurred cannot be established on the basis of hindsight. Any increase in investment only increases the risk exposure of the operator without giving any additional benefits."

The company presented a nearly 250-page reply to the CAG draft audit, while DGH's response was nearly 180 pages long.

Sources said that the private operators criticised the CAG for exceeding its brief and converting the special audit into a performance audit. Any audit has to be done under the production sharing contract which provides for the legal regime under which the companies have to operate. If audits like that done by the CAG were to go beyond the contract, there would be no legal protection left for the companies, they said.

The sources said that while RIL officials took almost 100 minutes to explain their point of view, Cairn representatives gave their explanation in less than 30 minutes. BG also took a similar amount of time.

The CAG had in its draft report of 7th June stated that the oil ministry and its technical arm, the DGH, had favoured private firms like RIL and Cairn India by allowing them to retain entire exploration acreage, turning a blind eye to the increase in capital expenditure and giving additional area in violation of the production sharing contract.

Sources said DGH urged CAG to focus in its final report on accounting issues with quantification, so as to ensure that revenue and expenditure reported in the books of accounts reflect a true and fair view in line with the accounting principles.

Also, procurement of goods and services should be viewed in the light of the common commercial practices prevailing in the private sector that distinguishes the performance of private sector and may not be unduly shadowed by the systems and procedures of a PSU, it said.

On pure technical issues, the CAG audit should rely on the judgement of the technical arm of the oil ministry for drawing conclusions in view of the fact that exploration and production complexity is not easily comprehensible. "The CAG's final comment should encourage enhanced inflow of private and foreign capital and technology," the DGH stated.

CAG may take two months to finalise its final report which would be tabled in parliament.


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