UltraTech Cement Limited (IFC-32265)

Countries
  • India
Where the impacts of the investment may be experienced.
Financial Institutions
  • International Finance Corporation (IFC)
International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.
Project Status
Completed
Bank Risk Rating
A
Risk rating varies among banks and may refer only to the particular investment and not to the risk for the project as a whole. Projects marked 'U' have an 'Unknown' risk rating at the time of disclosure.
Voting Date
Jul 3, 2013
The estimate day the bank will vote on a proposed investment. The decision dates may change, so review updated project documents or contact the EWS team.
Borrower
ULTRATECH CEMENT LIMITED
The holder of the loan, grant, or other investment.
Potential Rights Impacts
  • Cultural Rights
  • Healthy Environment
  • Housing & Property
  • Indigenous Peoples
  • Labor & Livelihood
  • Marginalized Groups
  • Right to Food
  • Right to Health
  • Right to Water
Only for projects receiving a detailed analysis, a broad category of human and environmental rights and frequently at-risk populations.
Investment Amount (USD)
$ 100.00 million
Value listed on project documents at time of disclosure. If necessary, converted to USD$. Please review updated project documents for more information.
Primary Source

Original disclosure @ IFC website

Updated in EWS Feb 6, 2018

Disclosed by Bank May 15, 2013


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Project Description

This Project involves the clinker production capacity expansion of UltraTech Cement Limited (UltraTech) at its integrated cement plant in Chhattisgarh, a low-income state in the eastern part of India, and the investments for the necessary infrastructure to support the expansion. The Project is a key component of Ultratech's cement capacity expansion strategy in the eastern part of India.

The proposed project comprises a brownfield expansion

Early Warning System Project Analysis

CATEGORIZATION

This is a Category A project according to IFC's environmental and social review because the project has the potential for resulting in significant adverse environmental and social impacts that will be diverse and irreversible.

APPLICABLE SOCIAL AND ENVIRONMENTAL STANDARDS
The IFC has identified the following performance standards:
PS 1 Assessment and Management of Environmental and Social Risks and Impacts
PS 2 - Labor and working conditions
PS 3 - Resource Efficiency and Pollution Prevention
PS 4 Community Health, Safety and Security
PS 5 Land Acquisition and Involuntary Resettlement
PS 7 Indigenous Peoples

CONSULTATION PROCESS

IFC states that public consultations have been completed for expansion of the cement plant (Rawan), the associated power plant, and Jhipan Mines as part of the requisite regulatory permitting process. For Guma mines, IFC states that UltraTech began interacting with the project-affected families soon after the land was identified for purchase in 2007, through its Land Team, which conducted several informal consultations and negotiations with individual landowners. The subjects of these consultations focused on the project, the need for land acquisition, land price and land purchase schedule.

Additionally, IFC states the UltraTech's Social Impact Assessment consultants conducted additional stakeholder engagement activities in Guma from July 2012 to April 2013, which included focus-group discussions with the affected communities to identify the impacts and community development needs. Altogether 15 consultations of various types were conducted from July 2012 to April 2013 in the village and at the community center. IFC holds that all consultations had a good representation from various socio-economic groups, which included women, Scheduled Tribe (ST) households and other vulnerable households. IFC states that the consultations were conducted in the local language and conducted in the presence of UltraTech representatives. In addition, discussions and interviews involving local government functionaries were also undertaken.

IFC indicates that, during the social impact assessment process, the key expectation of the project affected households expressed was for enhancement of employment opportunities, income generation, skills training and support to community infrastructure related to water, education, health and agriculture. During consultations, local communities expressed their concerns regarding the adequacy of mitigation measures undertaken by UltraTech, adequacy of compensation, delays in land purchase due to constitutional provisions, difficulties proving land ownership, damage to livelihoods, and road closures and the ability to ensure school attendance for school children.

UltraTech pledges that [t]he project will be transparent in disclosing information related to the project and people's participation will be sought across the project cycle. As a result of the consultations, IFC states that UltraTech has prepared and disclosed a livelihood restoration framework, social impact assessment report, environment and social action plan and a community development plan that addresses these key concerns and expectations of the affected communities. The Guma EIA recognizes that operationalizing these plants, demonstrating ownership of the suggestive measures and committing resources (human as well as financial) would be crucial to the success of livelihood restoration, meeting community expectations and developing/strengthening term trust and good will the company currently enjoys in the area.

IFC also states that subsequent to the local disclosure of social and environmental information, UltraTech has gone back and engaged, consulted with, and raised the awareness of, the affected communities about the project's impacts and benefits. IFC affirms that UltraTech is committed to continue engaging with the affected communities to provide information on mine development, its operations, as well as safety and health related issues. Specifically, IFC states that UltraTech is enabling capacity building of affected communities by facilitating the development of Village Level Committees that will engage in dialogue with the UltraTech and provide supervision over implementation of various social plans.

IFC documentation states that the project will maintain a community liason for the life of the project, from the project team. The responsibility of the liason will be to: [h]old regular meetings with VLCs, NGOs, and other stakeholders including investors disclose information (through periodic briefings) on the progress of implementation of the management plans and success of livelihood restoration strategies.[and] clarify and respond to any stakeholder concerns.

Lastly, IFC reports that the social impact assessment undertaken by UltraTech includes a Grievance Redress Framework that envisions the village level committees comprised of representatives from the affected community playing an active role redressing grievances that may arise from the company's activities. The Grievance Redressal Mechanism established for the purpose of this project will allow for the local communities to communicate their grievance and concerns on the various project activities, the risks associated with the same, the impacts and the subsequent mitigation measures in a proper manner while allowing the project proponent to respond to such views and take necessary actions. UltraTech must be held to these commitments in order to ensure the protection of the human rights of local communities.

Sources: IFC documentation, Rawan EIA, Guma EIA, Jhipan EIA

ENVIRONMENTAL AND HUMAN RIGHTS RISK ASSESSMENT

The following impacts are assessed in terms of cumulative impact of the operation based on environmental impact assessments undertaken for the expansion of the Raiwan cement plant, the Jhipan mine, and the Guma mine. However, there are at least six other large cement plants in the area (i.e. RWCW, Hirmi, Ambuja, Shree Cements, Lafarge, Jaypee and Imami). Therefore, where it is possible to identify cumulative effects, it is noted.

The environmental and social impact assessment for the expansion of the Guma mine is based on a study area for the project consisting of approximately 75 villages in the Baloda Bazar district. Six villages are in the immediate vicinity of the project district: Sarseni, Guma, Pausari, Champa, Thelki and Bharuwadih.

*** It should be noted that an independent environment and social review of the Guma mine was undertaken in February of 2012 that discovered gaps emerging with reference to the IFC standards. The EIA on which this analysis is based was an attempt to close these gaps.

LABOUR RIGHTS

Livelihood Impacts

The Guma environmental impact assessment (EIA) states that 55% of the total population in the project affected area is non-working.

Of the local employed community members in the agriculture sector, at least 17% of the project affected families face reduced income due to the project. This is alarming, especially considering the number of suicides of farmers per year (around 15,000), primarily due to indebtedness and agrarian distress, as estimated by the 2012 Human Rights in India Status Report. The Guma EIA states that [a]gricultural labourers as an impacted group/category are the most vulnerable (due to their characteristics like small or marginal holdings, limited access to credit, caste community linkages) category in the village. However the social survey and stakeholder consultations faced challenges in identifying the persons who were particularly engaged in the land impacted by a project due to the mobile nature of employment that these persons avail in the area.

In mitigation, UltraTech pledges that willing and suitable sharecroppers and agricultural labourers will be given preference in contracts [and]skilled and qualified people (from amongst the affected families) who meet the needs of the project will be given preference in employment. Furthermore, UltraTech states that it will [p]rovide access rights to the impacted vulnerable families to the land for agriculture purposes in order to avoid disrupting their agricultural dependent livelihood means.

External Stress on Local Resources

According to the Rawan EIA, labour will generally be sourced from the nearby villages and towns. However, up to 20% of the labour strength will have to be outsourced and will be put up at the site. This labour force along with their families may place pressure on the local communities.

Occupational Health and Safety

The Rawan EIA recognizes that the cement manufacturing industry is labor intensive and uses large scale and potentially hazardous manufacturing processes. The industry
experiences accident rates that are high compared with some other manufacturing industries. Cement industries experiences risk of a number of hazards inherent to the cement production process. Some examples of such hazards are: exposure to dust; exposure to high temperatures; noise exposure; physical hazards; chemical hazards and other industrial hygiene issues; and others. Exposure to fine particulates is associated with work in most of the dust generating stages of plant operations and also from, raw
material handling, and clinker / cement grinding. The Rawan EIA indicates that [w]orkers with long term exposure to fine particulate dust are at risk of pneumoconiosis, emphysema, bronchitis, and fibrosis. Exposure to heat may result from handling hot raw meal (i.e. powdered limestone, laterite additives etc. that are heated in a pre heater cyclone), hot clinker and operation and maintenance of kilns or other hot equipment. At the Jhipan mine, documentation states that a well-equipped has been provided for employees to take food and rest at subsidized rates. The EIA asserts that suitable steps have been taken to maintain the canteen in a clean and hygienic condition. Additionally, documentation states that water is made available to the mines workmen at the crusher, garage, and mines office canteen, to ensure that water is always available during the working hours.

The Jhipan EIA states that, in community consultations, [h]ealthy and safe working conditions are among the first expectations for sustainability, i.e. the expectation that risks in mining will not deprive workers of their livelihoods or of their quality of life. Occupational injuries and ill-health have huge social and economic implications for individuals, their families and their communities. They also have an adverse impact on
the economy of the society as a whole. Occupational accidents and health hazards can also affect public health and safety, and the environment. The effect on the health and safety of people, costs to the economy and impacts the environment. Efforts will be made to address occupational health and safety with broader social agenda for sustainable development.

The Guma EIA specifically notes that almost 14% of the population under 14 in the area are working. This raises child labor concerns, especially since there is widespread practice of child labor in South Asia in industrial operations, such as cement manufacturing. India specifically bans the employment of children in cement manufacture, including the baggage of cement. UltraTech must take steps to ensure that no children under the age of 14 are employed in its operations.

UltraTech Commitments

As part of its community development plan, UltraTech states that, trainings to improve skills and increase employability and promote income generation will be provided to all adult members of the affected families. With respect to agricultural labourers, training for farmers (who are interested and keen) for productivity enhancement will be given like use of high quality and better yield seeds, change in cropping systems, cultural practices, farm equipment, cattle camps, and animal husbandry development programs. Additionally, guidance and support for start-up enterprises and getting loan for cottage/small scale businesses will be provided to these families. UltraTech further states that specific commitments to be included into the contractor's commitment on the social obligations including community relations, handling complaints and grievances, health and safety on the work site, adherence to labor laws, and international commitments etc.

The following questions may be relevant to determining whether you or your community's labour rights have been adversely affected by UltraTech's construction or operation activities at the Rawan plant, Guma mine, Jhipan mine, or associated infrastructure:
- Can all members of your community apply for jobs in the context of the investment project?
- Are your wages sufficient to meet your basic needs and those of your family?
- Are your working conditions safe and healthy?
- Are there children under the age of 15 working on any aspect of this development project?
- What opportunities (legal or other) are available if you consider that your working conditions are not just and favorable?

Source: Rawan EIA, Guma EIA, Jhipan EIA, http://www.indianchild.com/childlabor/causes-of-child-labor-in-india.htm
http://www.childjustice.org/wsecl/papers/Molankal2008.pdf
http://www.childlineindia.org.in/CP-CR-Downloads/child_labour_updated_schedule.pdf
http://wghr.org/wp-content/uploads/2013/07/Human-Rights-in-India-Status-Report-2012.pdf

RIGHT TO FOOD

According to the 2012 Human Rights Status Report in India, 21% of India's total population remains undernourished, with women, girls and older persons being the most affected [as] 42% of children under five are underweight and 59% are stunted. The Guma EIA reports that, in the project area, the main occupation is agriculture and farm-based livelihoods in which 74% of the working population is involved. Additionally, the Jhipan EIA states that, in the project vicinity, [m]ost of the crops are grown on small farms (located near the village wells) where generally the work is done manually. If the local groundwater is contaminated during the mining operations, agriculture in the area may be threatened. As 19% of the agriculture population will suffer livelihood displacement, and 17% will suffer from reduced income from agricultural activities, local communities that use such activities for subsistence may be placed in a situation of further food vulnerability and insecurity.

The following questions may be relevant to determining whether you or your community's right to food has been adversely affected by UltraTech's construction or operation activities at the Rawan plant, Guma mine, Jhipan mine, or associated infrastructure:
- Has your ability to survive and provide for yourself on your own land been affected since the beginning of the investment project?
- Has your access to good and affordable food in sufficient quantity been affected since the beginning of the investment project?
- What opportunities (legal or other) are available if you feel that your right to food has been affected?

Source: Guma EIA, Jhipan EIA

http://www.thehindubusinessline.com/economy/agriculture-dependent-population-in-india-grew-by-50-during-19802011/article5732072.ece
http://wghr.org/wp-content/uploads/2013/07/Human-Rights-in-India-Status-Report-2012.pdf

RIGHT TO WATER

According to the 2012 Human Rights in India Status Report, the combined effects of inadequate sanitation, unsafe water supply and poor personal hygiene are responsible for 88% of childhood deaths from diarrhea. Additionally, 21% of the communicable diseases in India are related to unsafe water. Further, more than 20% of Scheduled Caste persons do not have access to safe drinking water and the vast majority of them depend on the goodwill of dominant castes for access to water from public wells.

The Guma EIA states that, within the district of Raipur . . . 99.66% of the villages are provided a drinking water source by the government. 90% of this drinking water supply is dependent upon ground water available in the region. The Rawan EIA provides that rainfall is the only direct source of ground water recharge for the area due to the fact that [t]he Mahanadi Canal is about 0.5 km from the project area, in which water is available in rainy season only. Further, in Guma most of the villages access their water through hand pumps and only 207 villages in the entire district, a total of 21.23%, have access to tap water. The ground water (generally considered to be potable) is available at depths of 500-600 feet, resulting in limited access of the community to ground water. This limited access is primarily the result of very few families being able to afford boring and also due to the frequent cases of bore wells drying up due to over-extraction of water. This indicates that access to water in the area is dependent on groundwater of sufficient quality and quantity.

The Jhipan EIA indicates that the ground water table is 236 mRL (40 mbgl) while the workings in the area is proposed up to the ultimate depth of 240 mRL (36 m bgl). If the workings go any deeper, it may threaten to compromise the water table. UltraTech pledges that there will be no discharge of mine water and [m]ineral as well as overburden is non toxic in nature. Ground water pollution can take place only if the mining rejects contain toxic substances, which get leached by the precipitation water and percolate to the ground water table thus polluting it. If this occurs, any nearby wells or other sources of water can be rendered unfit for drinking and even for industrial use. Furthermore, the EIA states that [w]hatever water gets collected in the mining pit either as direct rainfall falling in the pit or groundwater inflow will be collected in a sump and pumped back for road spraying, green belt and for supplying to nearby villages. If this water is becomes contaminated in any capacity, it may pose hazards for local communities.

In terms of sanitation, the Guma EIA states that only 30-40 households in the village Guma have their own toilets and bathrooms. However, due to the fact that most of the households do not have access to tap water, households in the study area resort to open defecation. Also none of the villages in the primary zone have a proper drainage/sewerage network that connects different parts of the village. Wastewater is generally drained out into fields and open areas in and around the households. The Guma EIA indicated that, in the household survey undertaken, the reasons for such a widespread practice of open defecation was attributed to habits, damaged toilets, bad odour, and fear among children and general lack of running water. Poor sanitation can adversely impact local water supplies and consequently, the health of local communities.

The following questions may be relevant to determining whether you or your community's right to water has been adversely affected by UltraTech's construction or operation activities at the Rawan plant, Guma mine, Jhipan mine, or associated infrastructure:
- Has your access to good, affordable, clean and safe water in sufficient quantity been affected since the beginning of the investment project?
- Has your access to appropriate sanitation facilities been adversely affected by the project?
- Does the company have a policy or programme to ensure that its activities do not affect people's right to water?
- What opportunities (legal or other) are available if you feel that your right to water has been affected?

Source: Rawan EIA, Guma EIA, Jhipan EIA

http://wghr.org/wp-content/uploads/2013/07/Human-Rights-in-India-Status-Report-2012.pdf

RIGHT TO PROPERTY/ADEQUATE HOUSING

Displacement from development projects can result in both physical displacement and livelihood displacement of local communities. According to the 2012 Human Rights Status Report for India, experts estimate the number of those displaced by such projects since 1947 is between 60 and 65 million. This amounts to around one million displaced every year. Of these displaced, over 40% are tribals and another 40% consist of Dalits and other rural poor. The National Human Rights Commission's (NHRC) stakeholders' report for India's second Universal Periodic Review (UPR) in 2012 stated that NHRC's monitoring finds that usually those displaced [as a result of development projects] are given neither adequate relief nor the means of rehabilitation.

Project documentation states that the Guma mines cover an area of 157.122 hectares of land comprised of both private (88%) and government land (12%). For purposes of the expansion, additional land of approximately 177.122 hectares of land will be acquired that will impact 244 families in Guma and 134 families in Sarseni. Guma village will lose approximately 20% of its arable agricultural land for the operation that will be permanently altered from agricultural to industrial land. At least 19% of the land loss will result in livelihood displacement of the project affected households and an additional 17% will experience reduced income from agriculture. It should be noted that this data is from a household survey [that] was constrained by the unwillingness of some households to participate in the process. The survey is based on data generated from approximately 51% of the families. Additionally, the data provided limited insights to the nature and extent of impacts on indigenous groups.

The Guma EIA states that the land will be acquired through direct purchase from the land owners on the basis of negotiated price settlement. In this respect, the EIA states that cash compensation for the loss of land at higher than market value (replacement cost) has been paid to the legal titleholders and land owners whose land has been purchased for the project. The value of land has been decided on the basis of a negotiated settlement and people have expressed satisfaction on the rates. Additionally, UltraTech states that land parcels whose access has been obstructed or which have been rendered unviable for use will also be purchased by the project. The compensation for these land parcels is/will be based on the replacement value of the land. The Guma EIA further states that [UltraTech] will also explore the option of providing monthly allowances to the vulnerable group so as to assist the process of livelihood restoration.

The EIA states that UltraTech has made an attempt to facilitate the purchase of replacement land by identifying sites where land was available . . . However, this option (though still available) did not enjoy the favour of the [project affected families]. The [project affected families] wished to get a comprehensive financial package in terms of higher purchase price of the land and freedom to decide on its utilization for managing and mitigating economic impacts due to loss of land.

With regards to mitigation, UltraTech states that livelihood restoration measures will be taken by the project to ensure that the affected families either restore or better their standard of living. The livelihood restoration plan will focus on the needs of this group of affected families. Additionally, the Guma EIA states that the affected families will be able to use the land for agricultural purposes as a transition arrangement until they are able to purchase replacement land. However, it should be noted that the EIA provides that only 15% of the replacement land is located within Guma village, with a number of PAFs purchasing land at a distance of more than 15km (more than 50% of the land purchased).

The Guma EIA further states that land resources, whether private or common are an extremely important asset for rural communities, especially so in the resource scarce dry tropical regions. At the village level it is the land resources which allow for the satisfaction of the needs/demands of fuel wood, and fodder for livestock and other everyday resources. At the household level, land holdings are arguably the most valuable asset for rural communities, which serve as an important means for livelihood and source of income.

The following questions may be relevant to determining whether you or your community's right to property and adequate housing has been adversely affected by UltraTech's construction or operation activities at the Rawan plant, Guma mine, Jhipan mine, or associated infrastructure:
- Have you and your community had an opportunity to provide meaningful input ate each stage of the project design and planning, including on resettlement plans, and provide suggestions about alternatives to relocation?
- Has the land and/or housing provided following relocation been adequate and of an equal or better quality than the land and/or housing previously occupied?
- If you were resettled, do you feel that you received adequate compensation for your land, housing, or crops?
- What options do you have (legal or otherwise) at your disposal in the event that you feel that your right to property or adequate housing has been compromised?

Sources: Guma EIA

http://wghr.org/wp-content/uploads/2013/07/Human-Rights-in-India-Status-Report-2012.pdf

RIGHT TO HEALTH

According to the 2012 Human Rights in India Status Report, India spends only 4.4% of its budget on health, which is far below the global median of 11.5%. As a consequence, India's health-care infrastructure is sub-standard and inadequate, lacking doctors and hospital beds. There are six doctors and nine hospital beds per 10,000 people. Only 15% of the population has health insurance, making quality healthcare in private hospitals inaccessible for a vast majority of the population.

The Guma EIA states that during the consultations undertaken, the villagers reported mostly respiratory diseases, itching, malaria, and common ailments such as fevers, cough, and cold as being the main sources of illness in the area. Further, the health facilities in the State of Chhattisgarh are poor, especially so in the rural areas with only 251 (1.2%) of the 20378 villages having a primary health centre and 137 community health centres. Therefore, the villages in the project footprint area don't have access to any facilities in the form of hospitals or PHCs. The nearest health facilities are in the towns of Bhatapara or Baloda Bazaar (17 to 35 km away respectively).

The Guma EIA indicates that the health and safety risks associated with the development and operations of the mines include likelihood of noise disturbance, respiratory diseases, increase in cases of eye irritation, increase in possibilities of road accidents, and risks associated with accidents during mine operations. The noise disturbances due to the activities movements of materials as well as blasting are likely to result in disturbance in the neighboring communities. Further, there will likely be cumulative effects with the UltraTech operation and the six neighboring cement operations as well which will include further reduction in agricultural land in the area, possible physical displacement, increased traffic and human activity linked to influx, environmental pollution, etc.

As a coal fired power plant, Rawan poses many consequences for human health, as combustion of coal releases emissions of sulfur dioxide (SO2), nitrogen oxides (NOx), particulate matter (PM), carbon monoxide (CO), volatile organic compounds (VOCs), and various trace metals like mercury, into the air through stacks that can disperse this pollution over large areas. Chronic and acute exposure to these pollutants has health impacts that include respiratory illnesses, compromised immune systems, cardiovascular conditions, and premature death.

The Rawan EIA specifically flags the issue of air of hazardous air pollution, stating that [o]ver the past years [polycyclic aromatic hydrocarbons (PAHs)] have been found to be ubiquitous constituents of urban airborne particles and have become a major health concern mainly due to their well-known carcinogenic and mutagenic properties. PAHs are formed during incomplete combustion of organic materials such as fossil fuels, coke and woods. Residence time and removal mechanisms of PAHs in the atmosphere depend on their distribution among the particle size fractions. PAHs emitted from combustion sources [are] thus emitted to atmosphere in gas phase or in fine particles. After the entrance to atmosphere they are cold and they unite or adsorbed into small particles. Those processes lead PAHs in higher concentrations to fine particles in the local area.

During the operation stage of the Rawan plant key emissions from the cement manufacturing process are emissions due to Particulate Matter, oxides of Nitrogen (NO2) and Sulphur dioxide (SO2). In the cement industry, NO2 are produced as a direct result of the high temperature flame in the cement kiln. Small levels of NOx can cause nausea, irritated eyes and/or nose, fluid forming in lungs and shortness of breath. Breathing in high levels of NOx can lead to: rapid, burning spasms; swelling of throat; reduced oxygen intake; a larger buildup of fluids in lungs and/or death. NOx, plus other ground-level ozone, can cause other major respiratory problems in high levels. It can also react with aerosols from aerosols cans and also cause respiratory problems. Furthermore, NOx can cause visual impairment in the area affects by NOx.

Additionally, the Jhipan EIA states that [t]he generation of dust is anticipated from various mining activities i.e. dozing, drilling, blasting, loading, haulage and other transport activities related to mining. These will increase PM10/PM2.5 in the area if no mitigative measures are taken. PM10 are likely responsible for adverse health effects because of their ability to reach the lower regions of the respiratory tract.

With regards to secondary effects, the mining activity in the ML area will require the Guana-Pausari road to be closed for public use. Hence, it would affect road connectivity and access to civic amenities and services available at Baloda Bazaar which is the district head quarter and the nearest township for Guma and surrounding villages. Lack of access to healthcare services in such areas could exacerbate an already vulnerable healthcare situation.

UltraTech states that although the villagers of Guma and Sarseni are offered treatment in the company hospital at nominal rates as part of the corporate social responsibility program, it is rarely availed by the community due to the fact that locals are yet [to] familiarise with these services. There is also an inherent reluctance to consult doctors or proper medical facilities by a large proportion of people. Additionally, UltraTech commits to organizing health and hygiene programs like, organization of medical health camp, general check ups, Family Planning Camp, Sicklings & Immunisation Camp, assistance in Pulse Polio camping, Mega Eye Cataract Camp, tricycle to handicapped, improving clean drinking water facilities, etc.

The following questions may be relevant to determining whether you or your community's right to health has been adversely affected by UltraTech's construction or operation activities at the Rawan plant, Guma mine, Jhipan mine, or associated infrastructure:
- Has your health been affected since the beginning of the investment project?
- Have you experienced an increase in either respiratory or water based-illness?
- Has your access to good, affordable and acceptable health services been affected since the beginning of the investment project?
- Has the company provided you with adequate and affordable health services at the company hospital?
- What opportunities (legal or other) are available if you feel that your right to health has been affected?

Source: Rawan EIA, Guma EIA, Jhipan EIA

http://www.urbanemissions.info/india-power-plants
http://www.ijesi.org/papers/Vol%202(7)/Version-4/I0274058068.pdf
http://wghr.org/wp-content/uploads/2013/07/Human-Rights-in-India-Status-Report-2012.pdf

RIGHT TO A HEALTHY ENVIRONMENT

Studies have associated quarrying and mining of raw material in India with pollution, contamination, and disturbance of local ecosystems. Additionally, the Government of India reports that cement manufacturing is an energy intensive process. Consuming energy from fossil fuels such as oil and coal creates carbon dioxide, the most important Greenhouse Gas causing climate change. In industrial sector, cement industry is the second largest emitter of carbon dioxide and accounts for 5 per cent of global manmade carbon dioxide emissions, of which 60 per cent is from the chemical process and 40 per cent from burning fuel.

The Rawan EIA recognizes that UltraTech's operations can disturb environment of the area in various ways, such as removal of mass, change of landscape, displacement of human settlement, flora and fauna of the area, surface drainage, and change in air, water and soil quality. While for purpose of development and economic upliftment of people, there is need for establishment of industries, but these have to be environmental friendly. The Jhipan EIA affirms this, stating that, the environmental parameters likely to be affected by mining are related to many factors, i.e. physical, social, economic, agriculture and aesthetic. Opencast mining involves extraction of underneath minerals; it's dumping and dumping of waste along with other operations, traffic network[s], and other vehicular movements.

The Rawan cement plant is a coal-fired plant. Coal fired plants are known to present significant costs to environment and human health. The water runoff from coal washeries carries pollution loads of heavy metals that contaminate ground water, rivers, and lakes - thus affecting aquatic flora and fauna. Fly-ash residue and pollutants settle on soil contaminating areas and are especially harmful to agricultural activities.

With respect to the dangers of using coal as a fuel source, the Rawan EIA recognizes that [a]nthropogenic activities tend to bring instability in the species composition and functioning of ecosystem. The first component to be affected directly as well as indirectly and in a short, medium and long time span would be the biotic component of the area. This sets a cyclic process, which may aggravate the situation unless corrective measures are adopted. Further, the EIA states that the quality of Indian coals, in general, is rather poor, being of low, noncoking grade, high mineral matter content, for which reason such coals need to be necessarily beneficiated to improve their quality to make them suitable not only for use in thermal power plants for power generation and steel industry but also for other non-fuel uses.

The Jhipan EIA states that mining activities cause environmental problems such as degradation of land, deteriorating air, water and soil quality, affecting the biological and
socio-economic environment of the area. Deleterious effects that may result from mine blasting include ground vibration, fly rock, air blast, noise, dust and fumes. The Jhipan EIA states that the explosive energy sets up a seismic wave in the ground, which can cause significant damage to structures and disturbance to human occupants. When an explosive charge is fired inside the blast hole, it is in converted into hot gases, which exert intense pressure on the blast hole walls. High intensity shock waves propagate radially in all directions and cause the rock particles to oscillate. 'This oscillation is felt as ground vibration. Non-controllable variables that may exacerbate the effects of the blasts include general surface terrain, type and depth of overburden.

Common Property Resources

The Guma EIA states that the mine and conveyor belt may affect common property resources, which are defined as community's natural resources where every member has access and usage facility with specified obligations without anybody having exclusive property rights over them. They include resources such as community pastures, community forests and woodlots, wastelands, common dumping and threshing grounds, watershed drainage, village ponds, rivers and rivulets and their banks and beds.

According to the EIA, these common property resources form a part of an essential survival strategy for the rural communities especially the rural poor in the form of social and institutional arrangements designed for the purpose of coping with stressed environmental conditions of their systems, especially in the semi-arid and arid regions of the dry tropical countries such as India.

Water

Common property resources specific to the Guma project area include the village water bodies and the common grazing lands of the villages. Guma has three of these water bodies (talaabs) in its vicinity, which are used during the dry months to satisfy everyday water needs for cleaning and washing purposes. In Rawan, local communities serve their irrigation water needs by drawing water from a large number of tube wells sunk around the important village of the buffer zone, for irrigation purpose[s]. Most of the tanks and ponds as well as the river water are being utilized for irrigation. During consultations, local residents stated that the pond was the lifeline of the village and its upkeep and care should be taken up by UTCL with support of the village.

The Rawan EIA states that, the plant will be [a] zero effluent discharge unit. Therefore, for the operation of proposed cement plant shall not pose any adverse impact on the
ground water resources of the area. During the construction stage, the construction workers colony will be provided with drinking water taps and sanitation discharge into septic tanks and soak pits. Wastewater is to be treated using existing sewage treatment plants and then used for horticultural activities. Due to the weakness of the existing sewage treatment systems, this may pose a hazard to local communities. The water and sewage situation must be closely monitored to ensure that water resources of local communities are not susceptible to further deterioration as a result of the operations of the plant.

After decommissioning the Guma mines, UltraTech proposes to rehabilitate the land area by developing a water body (which [theoretically] could be used by the community as a water source) and carrying out plantation activities.

Soil

The Rawan EIA suggests that there may be some pollution affecting the soils adjacent to plant area if proper care is not taken. The anticipated pollution to soil environment due to plant activities is as follows: changes in soil texture due to settling of air borne dust or due to wash off of solid particulates by surface or ground water. This will lead to change in porosity, permeability & other such physical characteristics of soil of the area; [and] changes in soil chemistry due to addition of foreign material from polluted air and water due to plant activities in the area.

Furthermore, the Rawan EIA indicates that [t]raffic at the site during construction will be more intensive and much heavier than at present and in normal operating conditions. In turn, it will subject roads to more stress. The prevailing soil surface particles within the proposed plant area shall have a tendency to become airborne by vehicular tyres once the area is disturbed by construction activities. This dust will lead to an increase in the background PM concentration of the area if proper control measures are not adopted.

During the construction phase at the Rawan site, solid waste such as excavated soil, debris, some metal waste, and oil and grease from construction machines will be generated. According to the EIA, this waste may contaminate soil at plant site. The excavated topsoil will be used for plantation. Additionally, the Rawan EIA indicates that sludge from Sewage Treatment Plant is used as manure for green belt development. If improperly treated, this could result in soil contamination.

Air

The Rawan EIA states that [a]ir pollution due to the proposed plant will mainly include gaseous pollution (SO2, NOx and CO) and Particulate Matter, which could pose a health hazard. The sources of air emissions during construction phase will include site clearing, emission from vehicles used for transportation of man and material to the site and from construction equipment. These emissions are expected to have temporary adverse impact on ambient air quality of surroundings of the construction site.

At Rawan, raw material like coal and fly ash will be transported via conveyor belts or trucks. The primary mode of transportation for gypsum, slag and iron ore will be the trucks/dumpers. As such, traffic at the site during construction will be more intensive and much heavier than at present and in normal operating conditions. In turn, it will subject roads to more stress. The prevailing soil surface particles within the proposed plant area shall have a tendency to become airborne by vehicular tyres once the area is disturbed by construction activities. This dust will lead to an increase in the background PM concentration of the area if proper control measures are not adopted.

Similarly, at Jhipan dust pollution may be generated during drilling, blasting, crushing
and transportation and loading activities. The air pollution may [also result from] vehicular movement[s] for transportation of mineral. Further, gaseous pollutants (SO2, NO2 and CO) are anticipated by [heavy duty machinery] like, excavator[s], dumpers, dozer[s] and other transport vehicles. Additionally, [t]he generation of dust is anticipated from various mining activities i.e. dozing, drilling, blasting, loading, haulage and other transport
activities related to mining. These will increase PM10/PM2.5 in the area if no mitigative measures are taken. PM10 are likely responsible for adverse health effects because of their ability to reach the lower regions of the respiratory tract.

During operation at Rawan, waste oil will be generated ... when lubricating oil is changed from the various gearboxes. It is mainly disposed off as per the following: burning waste oil in cement kiln under controlled condition; [and via] reuse in lubrication of other equipment exposed to dust/raw material where the waste oil gets consumed. If waste is not soundly managed, it could present a hazard to the local environment.

The following questions may be relevant to determining whether you or your community's right to a healthy environment has been adversely affected by UltraTech's construction or operation activities at the Rawan plant, Guma mine, Jhipan mine, or associated infrastructure:
- Has the company provided information to you regarding the disposal of solid waste, hazardous waste, and other waste products, and what impact is this likely to have on the local environment?
- Has the company informed you of an environmental action plan in place for reducing adverse ecological effects on local communities?
- What options do you have (legal or otherwise) if the environmental impacts of the proposed operations become a problem for local communities and/or the local ecosystem?

Source: Rawan EIA, Guma EIA, Jhipan EIA

http://www.ijesi.org/papers/Vol%202(7)/Version-4/I0274058068.pdf
http://www.samataindia.org.in/mici/attachments/article/44/Environmental%20issues_cement%20Plants.pdf
http://pib.nic.in/newsite/erelease.aspx?relid=45731
http://www.portal.gsi.gov.in/gsiDoc/pub/cs_cement_pollution.pdf

RIGHT TO CULTURE

The Guma EIA indicates that the most common areas of cultural significance in the project footprint villages are the temples of the communities, which are mostly located on the banks of the Taalaab. These temples hold importance for the community, especially during the religious festivals and important rites of passage for marriages and death. Apart from these, a number of households also have their own private shrines within the boundaries of their houses, which are used by the residents on a daily basis to offer prayers as well as on religious occasions. Additionally, the EIA reports that the land designated for the Ram Janaki temple falls within the Mine Lease Area. As a result, UTCL has begun a process of consultation with the community and has approached the District Collector for alternative land for the temple outside the Mine Lease Area.

Furthermore, the mining activity in the ML area will require the Guana-Pausari road to be closed for public use. Hence, it would affect road connectivity and access to civic amenities and services available at Baloda Bazaar which is the district head quarter and the nearest township for Guma and surrounding villages. UltraTech has thus proposed to divert the road along the mine lease boundary to restore the road connectivity between these villages and the district headquarter at Baloda Bazaar. This would result in increase of travel distance by 3-4km for villagers. The schoolchildren, women, and other community groups which frequent this road between Pausari and Guma would be affected. The Guma EIA states that the Community Development Plan will explore options for minimizing impacts by supporting schools with infrastructure support to ferry school children. However any resulting lack of access to cultural and educational institutions can infringe upon the rights of community to cultural expression.

The following questions may be relevant to determining whether you or your community's right to maintain your culture and customs has been adversely affected by UltraTech's construction or operation activities at the Rawan plant, Guma mine, Jhipan mine, or associated infrastructure:
- Were you informed and asked to provide input prior to the destruction of any valuable cultural heritage sites or relics for construction of the project?
- Has your access to cultural institutions been affected since the beginning of the investment project?
- Has your ability to maintain and use your traditional customs been affected since the beginning of the investment project?
- What opportunities (legal or other) are available if you feel that your right to take part in cultural life has been restricted or denied?
- Has your community has been discriminated against because of its culture?

Sources: Guma EIA

RIGHTS OF MARGINALIZED AND DISCRIMINATED AGAINST GROUPS

The Guma EIA states that villages in the direct impact area are characterized by 130 families below the poverty line (29% of total households). Additionally, the Guma EIA recognizes that, in India, the status of women is regarded as lower than that of men, with the lower status manifesting itself not only in terms of the economic power, but in terms of political and decision making power vested amongst the women in both private and public spheres. Overall, it is noted that representation of women in decision-making is relatively low, with the Sarpanch being the only woman member of the Panchayat [local governing counsel that engages in project planning and decision-making]. It is imperative that these vulnerable groups are included in informed decision-making in all phases of the development process in order ensure that their interests are represented.

The following questions may be relevant to determining whether you or your community's right to non-discrimination has been adversely affected by UltraTech's construction or operation activities at the Rawan plant, Guma mine, Jhipan mine, or associated infrastructure:
- Are you at a disadvantage or have you been disproportionately affected by the project due to your sex, race, religion, or socioeconomic class?
- Have you received appropriate information and were you allowed the opportunity to provide input regarding your special needs in the planning or operational stages of the project?
- What options (legal or otherwise) do you have if you feel that you have been discriminated against or marginalized in the project decision making process?

Source: Guma EIA

RIGHTS OF INDIGENOUS PEOPLES

In India, it is reported that almost 40% of displaced persons in the country are from the tribal communities. Many of these tribes have been displaced from the forests without any proper compensation and legal procedure, and the replacement infrastructure, land, and facilities for farming that are available and accessible to the tribal communities are not insufficient. Furthermore, most of these communities' livelihoods and cultures are inextricably linked to the land, rendering them disproportionately vulnerable to negative social effects of displacement.
With regards to the UltraTech operation, the Guma EIA states that, of the 130 families living below the poverty line that will be affected by the project, 24 are scheduled tribes, 82 are OBS, and 23 are scheduled castes. The assessment states that schedules tribes are rendered vulnerable group with regards to the project due to low literacy levels, traditional/customary health seeking behaviours, limited skills and capacities to be employable, traditional methods of agriculture, cultural and religious mores, etc.

With regards to land displacement, the Guma EIA notes that land details for project affected families in the village of Guma are currently not available for 48 tribal families due to the fact that the land purchase process was underway at time of assessment. The Guma EIA indicates that [d]uring the consultations with the tribal [project affected families], serious concerns over the delay in the purchase of tribal lands falling within the Mine lease area were expressed by [project affected families]. The tribal community is of the opinion that the said provisions, in the present scenario are inhibiting the tribal from willingly selling land and receiving the compensation they are entitled to. These groups see the delay in sale of land as an opportunity loss for themselves. UltraTech thus commits to paying advances to the impacted tribal families so that they can secure land in the area because the land prices and availability have seen a sharp uptrend and delay in dispersal of compensation would be detrimental to their chances of securing land.

The following questions may be relevant to determining whether you or your community's rights have been adversely affected by UltraTech's construction or operation activities at the Rawan plant, Guma mine, Jhipan mine, or associated infrastructure:
- Have you been discriminated against as an indigenous community?
- Has the project interfered with your ability to maintain your political, economic and social structures in accordance with your cultures, spiritual traditions, histories and philosophies?
- Have you been able to participate in decision making regarding the development and sustainable management of your environment?
- If relocated, was this after you had given your free, prior, and informed consent to be resettled?
- Were you given adequate compensation as part of the resettlement action plan for the project?
- If your indigenous rights were violated, do you have clear information on ways (legal and otherwise) of seeking justice, remedy, or compensation?

Source: Guma EIA
http://www.humanrights.asia/news/ahrc-news/AHRC-STM-129-2009

Investment Description
  • International Finance Corporation (IFC)

The total project cost is estimated at US$297 million. IFC has been requested to provide a loan of up to US$100 million for its own account.

Private Actors

UltraTech is a part of Aditya Birla Group (ABG) – one of India’s largest and most reputable conglomerates and a long-standing client of IFC in Egypt, India, Thailand and Indonesia. ABG operates in 33 countries with more than 133,000 employees worldwide. The group has diversified business interests in viscose staple fiber, metals, cement, viscose filament yarn, branded apparel, carbon black, chemicals, fertilizers, insulators, financial services, telecom, BPO and IT services. Grasim Industries Limited of the Aditya Birla Group has a 60.3% stake in UltraTech.
UltraTech, a listed company, has 12 integrated cement manufacturing plants, 15 grinding units, 5 bulk terminals and more than 100 ready mix concrete plants, spanning India, UAE, Bahrain, Bangladesh and Sri Lanka with 52 million tons per annum (Mtpa) capacity.

B. ADITYA BIRLA GROUP (ABG):

A US $40 billion corporation, the Aditya Birla Group is in the League of Fortune 500. It is anchored by a force of over 136,000 employees, belonging to 42 different nationalities.

Over 53 per cent of its revenues flow from its overseas operations. The group operates in 36 countries: Australia, Austria, Bangladesh, Brazil, Canada, China, Egypt, France, Germany, Hungary, India, Indonesia, Italy, Ivory Coast, Japan, Korea, Laos, Luxembourg, Malaysia, Myanmar, Philippines, Poland, Russia, Singapore, South Africa, Spain, Sri Lanka, Sweden, Switzerland, Tanzania, Thailand, Turkey, UAE, UK, USA and Vietnam.

In India the Group is responsible for:

  • The largest fashion ( premium branded apparel) and lifestyle player
  • The second-largest manufacturer and largest exporter of viscose filament yarn
  • The largest producer in the chlor-alkali sector
  • Among the top three mobile telephony companies
  • A leading player in life insurance and asset management
  • Among the top two supermarket chains in the retail business
  • Among the top 6 BPO companies
  • The largest manufacturer of linen fabric

C. GRASIM INDUSTRIES LIMITED:

An industrial company engaged in production of synthetic fibers, textiles, cement, and various chemicals.

PAST IFC FUNDING:

  1.  ULTRATECH is a newly formed company. The Company wants to select IFC as its long-term strategic partner.
  2. ADITYA BIRLA GROUP (ABG) is a long-standing client of IFC in Egypt, India, Thailand and Indonesia.
  3. GRASIM INDUSTRIES LIMITED (see ABG).

PRIOR ENVIRONMENTAL VIOLATIONS

According to the Access Initiative, on July 6, 2012, the UltraTech plant was shut down by the Government of India for violation of air pollution control norms. Issues included "air and noise pollution, threat to the catchment area of a local stream, health impacts on a village located nearby and shoddy implementations of Corporate Social Responsibility."

The Centre for Science and Environment rated Grasim Industries Limited, which has 22% of the market share of the cement industry, as mediocre in terms of being an environmental leader.

Contact Information

Local Project Contact:
Mr. V. Swaminathan, President - Finance
UltraTech Cement Limited
Ahura Centre, B-Wing, 2nd Floor
Mahakali Caves Road, Andheri(E), Mumbai
400093, India.
Email: swaminathan.v@adityabirla.com
Phone: +91.22.66917800
Fax: +91.22.66928109
Website: http://www.ultratechcement.com

LOCAL ACCESS OF PROJECT DOCUMENTATION
Mr. Krishna Padhi,
Vice President, P&A-HR
UltraTech Cement,
Rawan Cement Works,
Post: Grasim Vihar-493 196
Distt: Raipur (Chhattisgarh)-India
Email: krishna.padhi@adityabirla.com
Tel: +91.7726.288217-20
Fax:+91.7726.288208

CONSULTATION PROCESS

IFC states that public consultations have been completed for expansion of the cement plant (Rawan), the associated power plant, and Jhipan Mines as part of the requisite regulatory permitting process. For Guma mines, IFC states that UltraTech began interacting with the project-affected families soon after the land was identified for purchase in 2007, through its Land Team, which conducted several informal consultations and negotiations with individual landowners. The subjects of these consultations focused on the project, the need for land acquisition, land price and land purchase schedule.

Additionally, IFC states the UltraTech's Social Impact Assessment consultants conducted additional stakeholder engagement activities in Guma from July 2012 to April 2013, which included focus-group discussions with the affected communities to identify the impacts and community development needs. Altogether 15 consultations of various types were conducted from July 2012 to April 2013 in the village and at the community center. IFC holds that all consultations had a good representation from various socio-economic groups, which included women, Scheduled Tribe (ST) households and other vulnerable households. IFC states that the consultations were conducted in the local language and conducted in the presence of UltraTech representatives. In addition, discussions and interviews involving local government functionaries were also undertaken.

IFC indicates that, during the social impact assessment process, the key expectation of the project affected households expressed was for enhancement of employment opportunities, income generation, skills training and support to community infrastructure related to water, education, health and agriculture. During consultations, local communities expressed their concerns regarding the adequacy of mitigation measures undertaken by UltraTech, adequacy of compensation, delays in land purchase due to constitutional provisions, difficulties proving land ownership, damage to livelihoods, and road closures and the ability to ensure school attendance for school children.

UltraTech pledges that "[t]he project will be transparent in disclosing information related to the project and people's participation will be sought across the project cycle." As a result of the consultations, IFC states that UltraTech has prepared and disclosed a livelihood restoration framework, social impact assessment report, environment and social action plan and a community development plan that addresses these key concerns and expectations of the affected communities. The Guma EIA recognizes that "operationalizing these plants, demonstrating ownership of the suggestive measures and committing resources (human as well as financial) would be crucial to the success of livelihood restoration, meeting community expectations and developing/strengthening term trust and good will the company currently enjoys in the area."

IFC also states that subsequent to the local disclosure of social and environmental information, UltraTech has gone back and engaged, consulted with, and raised the awareness of, the affected communities about the project's impacts and benefits. IFC affirms that UltraTech is committed to continue engaging with the affected communities to provide information on mine development, its operations, as well as safety and health related issues. Specifically, IFC states that UltraTech is enabling capacity building of affected communities by facilitating the development of Village Level Committees that will engage in dialogue with the UltraTech and provide supervision over implementation of various social plans.

IFC documentation states that "the project will maintain a community liason for the life of the project, from the project team. The responsibility of the liason will be to: "[h]old regular meetings with VLCs, NGOs, and other stakeholders including investors disclose information (through periodic briefings) on the progress of implementation of the management plans and success of livelihood restoration strategies .[and] clarify and respond to any stakeholder concerns."

Lastly, IFC reports that the social impact assessment undertaken by UltraTech includes a Grievance Redress Framework that envisions the village level committees comprised of representatives from the affected community playing an active role redressing grievances that may arise from the company's activities. The Grievance Redressal Mechanism established for the purpose of this project will allow for the local communities to communicate their grievance and concerns on the various project activities, the risks associated with the same, the impacts and the subsequent mitigation measures in a proper manner while allowing the project proponent to respond to such views and take necessary actions. UltraTech must be held to these commitments in order to ensure the protection of the human rights of local communities.

ACCOUNTABILITY MECHANISM OF IFC

The Compliance Advisor Ombudsman (CAO) is the independent complaint mechanism and fact-finding body for people who believe they are likely to be, or have been, adversely affected by an IFC or MIGA- financed project. If you submit a complaint to the CAO, they may assist you in resolving a dispute with the company and/or investigate to assess whether the IFC is following its own policies and procedures for preventing harm to people or the environment. If you want to submit a complaint electronically, you can email the CAO at CAO@worldbankgroup.org. You can learn more about the CAO and how to file a complaint at http://www.cao-ombudsman.org/