Background Paper
LARGE INFRASTRUCTURE PROJECTS, SUSTAINABLE
DEVELOPMENT AND THE LAW: EMERGING ISSUES
AND CONCERNS
Background Paper for the International Convention organized by the
CII-ITC Centre for Sustainable Development, July 2008, New Delhi,
India
Knowledge Partner: J SAGAR ASSOCIATES, Advocates and Solicitors
Background Paper
LARGE INFRASTRUCTURE PROJECTS, SUSTAINABLE
DEVELOPMENT AND THE LAW: EMERGING ISSUES AND
CONCERNS
"The hidden architecture of sustainable development is the law."-Hernando de Soto
I
INTRODUCTION: WHY LARGE INFRASTRUCTURE PROJECTS DESERVE
SPECIAL FOCUS FOR SUSTAINABLE DEVELOPMENT
Large Infrastructure projects require large resources and have large impacts. The scale of the
investments needed for these projects coupled with the scale of their impacts always makes
an inquiry into such projects from the paradigm on a sustainable development a rewarding
exercise. This is particularly so since now increasingly public services and goods are sought
to be delivered in a public–private-partnership mode wherein the authorities need to strike a
balance between viability, affordability and sustainability while ensuring that there is a
demonstrable “value for money”. The present international convention has been planned
with this realization in mind.
Towards Development paths that are Economically, Socially and Ecologically
Sustainable: The Convention hopes to delve into the core issue of why an assessment of
larger infrastructure projects on the touchstone of sustainable development has perhaps
become more important than ever before in countries like India today. The World
Commission on Environment and Development (Brundtland Commission) in its famous
Background Paper
report Our Common Future over two decades ago had said that a sustainable development is a
process of change in which the exploitation of the resources, the direction of investments,
the orientation of technology and institutional change are all in harmony and enhance both
current and future potential to meet human needs and aspirations.1 In this context a recent
work clarifies that “sustainable development does not imply absolute limits to growth and it
not a new name for environmental protection.” It is rather ‘a new concept of economic
growth’ which helps ‘induce development paths that are economically, socially and
ecologically sustainable’.2 Mega projects like the Ultra Mega Power Projects, Dams,
Highways, Airports and large construction projects are today the engines for inducing new
developments paths in India and addressing the economic, social and environmental
dimensions of sustainability of these projects is the special theme of the present convention.
Law and Policy as significant drivers of Sustainable Behaviour in Project Planning:
With the understanding as above, the convention aims to show that large infrastructure projects can lead
to economic and social benefits to masses if they are planned and executed in an inclusive, socially responsible
and environmentally sound manner. A compliance of policy and legal provisions on Resettlement
and Rehabilitation (R&R) and due processes in land acquisition and compensation to all
Project Affected Persons (PAPs) can contribute to making projects socially responsible.
Further, compliance with the letter and sprit of the Environment Impact Assessment
Notification (under the Indian law) and Pollution laws can help make projects
environmentally sound.
When effectively enforced, law and policies can be a significant driver of responsible
behaviour. Thus the need for due compliance with policy provisions, laws and regulations as
set out in the Para above also suggest the central role of law and policy in ensuring
sustainability. Since the role of law is vital in sustaining large infrastructure projects it will be
useful to see the impact of litigation in the Supreme Court and the High Courts on large
infrastructure projects including cases on river valley projects, thermal power plants, roads
1See
Our Common Future -A Report of The World Commission on Environment and Development, ,
1987, p.46
2 Goyal, Anupam The WTO and International Environmental Law: Towards Conciliation, OUP,2006
Background Paper
and highways, amongst others. These case histories of conflict and controversies around
large infrastructure projects have useful lessons to offer and the conference shall aim to
build on these.
With the background and nature of issues arising as above the convention proposes to
explore the questions in specific infrastructure sectors. These will include: Large Civil
Construction Projects, Energy Infrastructure, Large Transport Projects and Projects on Public Private
Partnerships. Each of these Sectors has both sector specific issues and also show cross cutting
issues that can be shared across these sectors. Some of the essential themes and issues for
the Convention including key conceptual links, policy, practice and regulatory perspectives
are introduced and discussed in some detail in the pages below.
II
SUSTAINABLE DEVELOPMENT AND LARGE INFRASTRUCTURE: KEY
CONCEPTUAL LINKS
It is important to first appreciate the links between sustainable development and
Infrastructure. The core idea of sustainable development is development that meets the need
of the present without compromising the ability of future generation to meet their own
needs. This core idea is attributable to The World Commission on Environment and
Development which, as noted above, also added that “sustainable development is a process
of change in which the exploitation of the resources, the direction of investments, the
orientation of technology and institutional change are all in harmony…”3 It is also useful
here to keep in mind the principles laid down by the Rio Declaration on Environment and
Development, adopted by the UN Conference on Environment and Development in 1992.
The principles under the Rio Declaration included sustainable utilization of natural
resources; the integration of environmental protection and economic development; the right
to development; the pursuit of equitable allocation of resources both within the present
generation and between present and future generation (intra and inter-generational equity)
3
See Our Common Future, Report of the UN World Commission on Environment and Development.
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and the internalization of environment costs through application of the ‘polluter pays’
principle.4 On another note for the believers of intensive economic growth a workable
understanding of term may be put as follows: “sustainable development is an increase of a
country’s wealth production, in other words of its gross income, which does not entail
parallel reduction or degradation of its natural capital. That definition also ensures that the
ideal of Justice between the generations will be realized, because it demands that a country’s
natural capital should be conserved and passed on to future generations unscathed.”5
Speaking of infrastructure projects, it may first be noted that the Conference focuses on
economic and physical infrastructure (e.g., Dams, Power Projects, transport projects etc
rather than the larger notion of social infrastructure (including housing, health and
educational facilities). Besides, even within the sphere of physical infrastructure the focus is
on large infrastructure projects that require large investments and have large impacts.
Typically such projects have long lead times, high fixed costs and diverse users. These
Projects have significant implications for achievement of sustainable development objectives
as they directly impact economic, social and the cultural life in a locality, and as a
consequence, infrastructure failures can have widespread impacts across the community.
This should then mean that planning and execution, operation and maintenance of
Infrastructure projects should aim to address at all stages all dimensions of sustainable
development – economic, environmental, social and cultural. This in turn means extending
the boundaries of consideration beyond the immediate resources used in providing
infrastructure. In other words, an approach to sustainable infrastructure in this sense should
mean that every attempt needs to be made to not shift liabilities for future generations, ‘or
push effects beyond the boundaries of market transactions, on the environment, on social
cohesion and on cultural integrity.’
Large infrastructure projects however need not be narrowly seen as something to be
‘contained’ for the benefit of the environment and the society. The positive contribution that
Principles 3 to 8 and 16 of the Rio Declaration
The Law of Sustainable Development: General Principles-A Report Produced for the European Commission by
Michael Decleris, European Commission,2000
4
5
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well designed infrastructure can make to improvement in the other dimensions of
sustainability need not be understated. Infrastructure is a key element for realizing sustained
economic growth and sustainable development to achieve the Millennium Development
Goals (MDGs), and in particular, MDG 1 (Poverty Reduction) and MDG 7 (Environmental
Sustainability).6 Thus a sound and well planned infrastructure project can meet a variety of
economic, social, cultural and environmental needs. A ‘Sustainability’ perspective only
demands that the economic role and significance of infrastructure should be seen together
with the other dimensions of sustainable development i.e. the social, cultural and
environmental aspects.
As Infrastructure is a key element for realizing both sustained economic growth and
sustainable development major business leaders across the globe has often argued that
sustainability is not only compatible with but crucial to business success. In a major study by
the World Business Council for Sustainable Development the authors drawing on nearly 70
case histories of companies around the world, showed how the three pillars of sustainable
development -- economic growth, ecological balance, and social progress -- work to improve
the bottom line even as they create a better world.7 Such approaches are relevant than more
than ever before in high growth and large infrastructure investment friendly countries like
India today. With increasing public and private sector participation and partnership in
infrastructure development, it becomes very important that resources for development are
directed towards sustainable development. It is easy to see that a judicious mix of choices
The unmet demand for social and physical infrastructure to support the delivery of housing,
transportation, energy, water services and to overcome the deficiency of food limits economic
opportunity and is therefore a major barrier to the achievement of MDG 1. See, the Report of the
First Policy Consultation Forum of the Seoul Initiative on Green Growth on “Promoting Sustainable
Infrastructure Development” under the aegis of the UNITED NATIONS ECONOMIC AND
SOCIAL COMMISSION FOR ASIA AND THE PACIFIC, September 2006
6
7
See Walking the Talk: The Business Case for Sustainable Development By Charles O. Holliday, Chad
Holliday , Stephan Schmidheiny , Philip Watts, WORLD BUSINESS COUNCIL FOR
SUSTAINABLE DEVELOPMENT, Green Leaf 2002
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would needs to be exercised to maintain the delicate balance for pursing economic growth
without compromising sustainability needs.
Even while it is clear that ‘a judicious mix of choices’ would have to be made for sustainable
large infrastructure projects there are limitations in existing approaches that we shall have to
overcome as we move ahead. A Policy Consultation Forum of the United Nations Economic
and Social Commission for Asia and the Pacific after an intensive brainstorming on the subject of
‘Promoting Sustainable Infrastructure Development’ in a meeting held in Seoul, South
Korea in September 2006 concluded that “So far, discussions on infrastructure development
have been focused mainly on financing issues and engineering aspects in the region.
Mainstreaming environmental aspects and incorporating the eco-efficiency concept into
various stages of infrastructure development have not been considered as much as they
should have been.” Amongst other conclusions of the Forum the three that seem most
relevant in the context today include:
•
In many cases decisions for development of infrastructure are dependent on
political
decisions,
which
sometimes
are
not
scientifically
and
environmentally sound.
•
Strategic Environmental Assessment (SEA) and lifecycle assessment, taking
into account the long term impact of infrastructure use, have not been widely
applied in infrastructure development in the region.
•
There is lack of comprehensive statistical data and valuable information to
understand the current eco-efficiency levels of existing infrastructure
(including long term environmental impact of usage and lifecycle of the
infrastructure) and future development plans.
The points made above by the United Nations Commission shows that there is a lot to be
done as we tread on the path of making large infrastructure projects sustainable. The points
are especially relevant for large infrastructure projects that have large impact for economy
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and society. The economy progresses in leaps and bounds out of such projects but unless
the social fabric both, human and ecological, are not properly protected, the economic
development may not achieve the desired objectives. Governmental Policies of EIA and SIA
together with social legislative framework aim at striking a balance between the two. It is to
these national policy and legal initiatives shaped for an environmentally sound and socially
responsible project planning that we next turn to.
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III
NATIONAL POLICY AND LEGAL INITIATIVES FOR SUSTAINABLE
INFRASTRCTURE PROJECTS
Some of the key national policy and legal initiatives for sustainable infrastructure projects
include- Environment Impact Assessment and Environment Policy under the Environment
Impact Assessment Notification, 2006 and Environment Policy, 2006 respectively ;
Addressing Displacement and Providing for Resettlement Needs including under the
National Rehabilitation and Resettlement Policy, 2007; Social Impact Assessment of
Infrastructure Projects and Mechanism for Compensation for Land Acquisition for the
Project Affected under the Land Acquisition Act,1894. Each of these are discussed in detail
hereunder.
A. Environment Assessment and Policy for Infrastructure Projects
Environment Impact Assessment Notification, 2006: The Environment Impact
Assessment dated 14 September, 2006 (“EIA”) issued by the Ministry of Environment and
Forests, Government of India divides projects or activities requiring prior environmental
clearance into two categories namely- ‘A’ and ‘B’. The projects are categorized into category
‘A’ and ‘B’ on the basis of the potential impact the projects will have spatially on ‘human
health and natural and man made resources’ The projects or activities falling under category
‘A’ of the Schedule to the EIA notification require approval from Central Government
Ministry of Environment and Forests (“MOEF”) based on recommendations submitted by
an Expert Appraisal Committee (“EAC”) and projects or activities falling under category ‘B’
of the Schedule to the EIA notification require prior approval of State Environment Impact
Assessment Authority (“SEIAA”) based on recommendations of a State or Union territory
level expert Appraisal Committee (“SEAC”) before commencing any work on the land
except for acquisition of land which does require prior approval. Pursuant to application for
environmental clearance for new projects the EAC and the SEAC at central and state level
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respectively, will carry out the following four stages prior to according the environmental
consent:- 1. Screening 2. Scoping 3.Public Consultation and 4. Appraisal. A Chart showing the ‘four
step procedure’ and timelines under the Notification is shown below:
EIA Procedure Chart
An EIA clearance would approximately take a period of 9 months from the time of application by the
project proponent, provided no disagreement/objections on the said application have been made.
Screening for
category B
projects
B 1 – Requiring
EIA Report
B2–
Not requiring EIA
report and public
consultation
Scoping
60 days
Category A
Category B1
Public consultation
45 days
Written comments
by other concerned
persons
Public Hearing
Appraisal
60 days
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Under the EIA Notification, 2006, the concerns of local affected persons and others who
have plausible stake in the environmental impacts of the project or activity are ascertained
through Public Consultation. For the purpose, a Public Hearing is got conducted at the
Project site(s) or in its close proximity District wise, through the concerned State Pollution
Control Board.8 The advertisement/notice for Public Hearing informs the public about
these places or offices where the public could access the EIA report and its Executive
Summary, before the Public Hearing. For obtaining responses in writing, MOEF and the
concerned State Pollution Control Board also invite responses from concerned persons by
placing on their website the summary EIA report. The public hearing report of a project
forms the part of environmental clearance proposal that is submitted to MOEF along with
EIA and EMP reports.
There are clauses under the EIA Notification that may be susceptible to misuse. An
example of this is the specific clause that requires the public hearing to be cancelled “if the
local conditions are not conducive”. Environmentalists raise other points that cast a critical
eye on the Notification. The handing over of the responsibility of granting clearance to a
large number of projects to the state governments without any system of checks and counter
checks is questioned on the ground that in many instances, the state government is directly
involved in seeking investments. Exclusion of large capacity under specified thresholds from
EIA exemption of set of project/activities from public consultation has also been
questioned. Such criticism point to the need for firming up the provisions of the EIA
Notification even as we gain more experience under the legal regime that it lays down
mandating environmental assessments of infrastructure projects.
National Environment Policy, 2006: The National Environment Policy 2006 (“NEP”) can be
said to be the first comprehensive policy document formulated at national level for realizing
the overarching goal of sustainable development in the country. The NEP outlines the
8
The Notice of the Public Hearing is advertised in one major National Daily and one Regional
vernacular daily, with a minimum notice period of 30 days, for furnishing the response of Public.
One hard copy and one soft copy of the EIA report and its Executive Summary are also forwarded
to authorities namely District Magistrate/s, Zila Parishad or Municipal Corporation, District
Industries Office and Regional Office of MOEF.
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significance of a number of new and continuing initiatives for enhancing environmental
action of diverse actors and stakeholders at all levels. Although the contents of the policy are
not discussed in detail here for the sake of brevity, it can serve as a guide as we plan to make
our large infrastructure projects sustainable.
B. Addressing Displacement and Providing for Resettlement Needs out of
Infrastructure Projects
The Clearance of a Project following an EIA is also linked with Rehabilitation and Resettlement
aspects of the project. This link is provided by the fact that typically the mandatory
conditions appended with the EIA Clearance of any project also lays down that (a)
R&R in sufficient detail shall be finalized before the award of the project and
a copy of the detailed R&R shall be submitted to Ministry of Environment
and Forest( MoEF) within three months or before the award of the project.
(b)
Project Affected Persons (PAPs) losing their homesteads or a major portion
of the land shall not be ousted from the land till they are settled in the
alternate sites.
(c)
A Committee under the auspices of the District Administration with
representatives of the PAPs, Local Panchayats (elected rural local bodies) and
representatives of NGOs and Project Proponents shall be constituted to
monitor the implementation of the R&R Plan.
National Rehabilitation and Resettlement Policy, 2007
The National Rehabilitation and Resettlement Policy of 2007 issued by the Ministry of Rural
Development, Government of India and notified on 31 October 2007 rightly records in its
preamble that “Provision of public facilities or infrastructure often requires the exercise of
legal powers by the state under the principle of eminent domain for acquisition of private
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property, leading to involuntary displacement of people, depriving them of their land,
livelihood and shelter; restricting their access to traditional resource base, and uprooting
them from their socio-cultural environment.”9 In this context the objectives of the National
Rehabilitation and Resettlement Policy deserve notice. They include:
(a) to minimize displacement and to promote, as far as possible, non-displacing or leastdisplacing alternatives;
(b) to ensure adequate rehabilitation package and expeditious implementation of the
rehabilitation process with the active participation of the affected families;
(c) to ensure that special care is taken for protecting the rights of the weaker sections of
society, especially members of the Scheduled Castes and Scheduled Tribes, and to create
obligations on the State for their treatment with concern and sensitivity;
(d) to provide a better standard of living, making concerted efforts for providing sustainable
income to the affected families;
(e) to integrate rehabilitation concerns into the development planning and implementation
process; and
(f) where displacement is on account of land acquisition, to facilitate harmonious
relationship between the requiring body and affected families through mutual cooperation.10
The Policy provides for the establishment of the Resettlement and Rehabilitation Committee
at the project level to monitor and review the progress of implementation of resettlement
and rehabilitation schemes. The State Government also prescribes the composition, powers,
functions and other matters relating to the functioning of the Rehabilitation and
Resettlement Committee at the District level, which is headed by the District Collector/
District Commissioner of the district.11
Clause 1.1 of the National Rehabilitation and Resettlement Policy, 2007
Clause 2.1 of The National Rehabilitation and Resettlement Policy, 2007
11 Clause 8.2.1 of The National Rehabilitation and Resettlement Policy, 2007
9
10
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The Policy also acknowledges that many State Governments, Public Sector Undertakings or
agencies, and other requiring bodies either have their own Rehabilitation and Resettlement
(R&R) policies or are in the process of formulating them. It makes clear that “the provisions
of the National Rehabilitation and Resettlement Policy, 2007 (NRRP-2007) provide for the
basic minimum requirements, and all projects leading to involuntary displacement of people
must address the rehabilitation and resettlement issues comprehensively. The State
Governments, Public Sector Undertakings or agencies, and other requiring bodies shall be at
liberty to put in place greater benefit levels than those prescribed in the NRRP-2007.”12
Many State Governments in India have come up with their own R&R Policy/Model Policy
which is also applicable to all infrastructure projects coming up in these States.
Applicability and Mechanism of the New Policy: The Preamble of The National
Rehabilitation and Resettlement Policy, 2007 states that: “A national policy must apply to all
projects where involuntary displacement takes place”. However, the appropriate Government shall
declare area of villages or localities as an “affected area” only if there is likely to be “involuntary
displacement of four hundred or more families en masse in plain areas, or two hundred or more families en
masse in tribal or hilly areas, DDP blocks or areas mentioned in the Schedule V or Schedule VI to the
Constitution due to acquisition of land for any project or due to any other reason”.
After the declaration of an area as “affected area”, the Administrator for Rehabilitation and
Resettlement undertakes a baseline survey and census for identification of the persons and
families likely to be affected by the proposed project. The 2007 Policy also provides that the
appropriate Government may appoint an Administrator for Rehabilitation and Resettlement
(hereafter called “Administrator”), who is an officer not below the rank of District Collector,
to oversee the resettlement and rehabilitation plan. But the Administrator can delegate
his/her powers and duties to any officer not below the rank of Tehsildar or equivalent. The
Administrator is vested with the power of “overall control and superintendence of the
formulation, execution and monitoring of the rehabilitation and resettlement plan”
However, the Administrator can only exercise his powers and functions “subject to the
12
Clause 1.7 of the Policy.
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superintendence, directions and control of the appropriate Government and Commissioner
for Rehabilitation and Resettlement” and “subject to any general or special order of the
appropriate Government”.
Rehabilitation and Resettlement Benefits for the Affected Families: Rehabilitation and
Resettlement Benefits for the Affected Families are provided under Chapter VII of the new
Policy. Some of the main provisions in this regard include:
•
Any affected family owning house and whose house has been acquired or lost, may
be allotted free of cost house site to the extent of actual loss of area of the acquired
house but subject to a cap in rural and urban areas.
•
Each affected below poverty line family which is without homestead land and which
has been residing in the affected area continuously for a period of not less than three
years preceding the date of declaration of the affected area and which has been
involuntarily displaced from such area, shall be entitled to a house of minimum one
hundred square metre carpet area in rural areas, or fifty square metre carpet area in
urban areas.
•
Each affected family owning agricultural land in the affected area and whose entire
land has been acquired or lost, may be allotted in the name of the khatedar(s)in the
affected family, agricultural land or cultivable wasteland to the extent of actual land
loss by the khatedar(s)in the affected family subject to a maximum of one hectare of
irrigated land or two hectares of un-irrigated land or cultivable" wasteland, if
Government land is available in the resettlement area.
•
In the case of irrigation or hydel projects, the affected families shall be given
preference in allotment of land-for-land in the command area of the project, to the
extent possible.
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•
In case of allotment of wasteland or degraded land in lieu of the acquired land, each
khatedar in the affected family shall get a one-time "financial assistance of such
amount as the appropriate Government may decide but not less than fifteen
thousand rupees per hectare for land development.
•
The ‘requiring body’ shall give preference to the affected families – at least one
person per nuclear family - in providing employment in the project, subject to the
availability of vacancies and suitability of the affected person for the employment.
The list of the benefits as above shows that the Policy while planning for ‘land for land’ to
the extent possible, does not guarantee land-for-land compensation to the displaced families.
Civil society organizations also feel that under the Policy the affected persons are denied the
rights to take any kind of informed decision regarding the usage of their lands with regard to
development projects.
One of the most important features of the National Rehabilitation and Resettlement Policy
of 2007 is the introduction of the concept of Social Impact Assessment in India. This is
discussed next in some detail.
C. Social Impact Assessment of Infrastructure Projects
The National Rehabilitation and Resettlement Policy of 2007 has introduced the concept of
Social Impact Assessment (SIA) of Projects. The Policy States: Whenever it is desired to
undertake a new project or expansion of an existing project, which involves in voluntary displacement of four
hundred or more families en masse in plain areas, or two hundred or more families en masse in tribal or hilly
areas, DDP blocks or areas mentioned in the Schedule V or Schedule VI to the Constitution, the
appropriate Government shall ensure that a Social Impact Assessment (SIA) study is carried out in the
affected areas in such manner as may be prescribed.13
13
4.1 of the National Rehabilitation and Resettlement Policy, 2007
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The factors to be taken into consideration while carrying out an SIA has been identified in
the 2007 Policy in some detail. Thus it lays down that while undertaking a social impact
assessment, the appropriate Government shall, inter alia , take into consideration the impact
that the project will have on public and community properties, assets and infrastructure;.
particularly, 'roads, public transport, drainage, sanitation, sources of safe: drinking water,
sources of drinking water for cattle, community ponds, grazing land, plantations; public
utilities, such as post offices, fair price shops, etc.; food storage godowns, electricity supply,
health care facilities, schools and educational/training facilities, places of worship, land for
traditional tribal institutions, burial and cremation grounds, etc.14
Even though SIA has been introduced in the policy discourse the policy does not give more
details especially on the concept, methodology and the steps to carrying out an effective and
credible SIA. A few more words on these aspects would be useful here. In general terms,
SIA is analyzing, monitoring and managing the social consequences of development. Social
impact assessment can be defined as the process of assessing or estimating, in advance, the
social consequences that are likely to follow from specific policy actions or project
development.15 The focus of concern of SIA is a proactive stance to development and better
development outcomes, not just the identification or amelioration of negative or unintended
outcomes. Assisting communities and other stakeholders to identify development goals, and
ensuring that positive outcomes are maximized, can be more important than minimizing
harm from negative impacts.16 Some of the principles specific to SIA practice has been
reproduced in the Box below:
4.2.2, National Rehabilitation and Resettlement Policy, 2007
Rabel J. Burdge and Frank Vanclay, ‘Social Impact Assessment’ in Environmental and Social Impact
Assessment, John Wiley and Sons (UK) 1995
14
15
Frank Vanclay, International Principles For Social Impact Assessment in Impact Assessment and Project
Appraisal, volume 21, number 1, March 2003, pages 5–11, Beech Tree Publishing, 2003
16
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Principles specific to SIA practice
1. Equity considerations should be a fundamental element of impact assessment and of
development planning.
2. Many of the social impacts of planned interventions can be predicted.
3. Planned interventions can be modified to reduce their negative social impacts and enhance
their positive impacts.
4. SIA should be an integral part of the development process, involved in all stages from
inception to follow-up audit.
5. There should be a focus on socially sustainable development, with SIA contributing to the
determination of best development alternative(s) – SIA (and EIA) have more to offer than
just being an arbiter between economic benefit and social cost.
6. In all planned interventions and their assessments, avenues should be developed to build
the
social and human capital of local communities and to strengthen democratic processes.
7. In all planned interventions, but especially where there are unavoidable impacts, ways to
turn impacted peoples into beneficiaries should be investigated.
8. The SIA must give due consideration to the alternatives of any planned intervention, but
especially in cases when there are likely to be unavoidable impacts.
9. Full consideration should be given to the potential mitigation measures of social and
environmental impacts, even where impacted communities may approve the planned
intervention and where they may be regarded as beneficiaries.
10. Local knowledge and experience and acknowledgment of different local cultural values
should be incorporated in any assessment.
11. There should be no use of violence, harassment, intimidation or undue force in
connection with the assessment or implementation of a planned intervention.
12. Developmental processes that infringe the human rights of any section of society should
not be accepted.
Source: Frank Vanclay, International Principles for Social Impact Assessment, 2003
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D. Mechanism for Compensation for Land Acquisition for the Project Affected
The legislative mandate for acquiring land for public purposes comes from the Land
Acquisition Act of 1894 (hereinafter also referred to as “LAA”). The Land Acquisition Act,
1894 allows for land acquisition for public purpose for infrastructure projects for example,
power plants, dams, canals, industrial plants, transmission lines and highways to be carried
out by the respective States or companies, in accordance with the provisions laid down
under the enactment. Under the Act, monetary compensation is provided in lieu of the loss
of land, other assets like standing crops and trees, dwelling units, etc. The land, the interests
of which is already vested in Government and in which no interests of private person exist,
cannot form the subject of proceedings under the Land Acquisition Act. The transfer of
such land from one department to another or to a local authority or to a Corporation owned
or controlled by the State or Company can be arranged for by executive action without
resorting to the provisions of the LAA.
The LAA empowers the District Collector to make an award stating (a) the true area of the
land acquired for the project; (b) the compensation which in his opinion should be allowed
for the land; and (c) the apportionment of the said compensation among all the persons
interested in the land. Compensation for land and improvements (such as houses, wells,
trees, etc.) is paid in cash by the project authorities to the State government, which in turn
compensates landowners. The price to be paid for the acquisition of agricultural land is
based on sale prices recorded in the District registrar's office averaged over the three years
preceding notification under Section 4 of the LAA. The compensation is paid after the area
is acquired, actual payment by the State taking about two or three years. An additional 30
percent is added to the award as well as an escalation of 12 percent per year from the date of
notification to the final placement under Section 9 of the LAA. For delayed payments, after
placement under Section 9, an additional 9 percent per annum is paid for the first year and
15 percent for subsequent years.
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There are special provisions for acquisition of land for specific purposes for Companies
under the LAA. These special provisions, amongst other things, also require the Company to
enter into an agreement with the appropriate Government, providing to the satisfaction of
the appropriate Government for the following matters, namely:•
the payment to the appropriate Government of the cost of the acquisition;
•
the transfer, on such payment, of the land to the Company.
•
the terms on which the land shall be held by the Company,
•
where the acquisition is for the purpose of erecting dwelling houses or the provision
of amenities connected therewith, the time within which, the conditions on which
and the manner in which the dwelling houses or amenities shall be erected or
provided;
•
where the acquisition is for the construction of any building or work for a Company
which is engaged or is taking steps for engaging itself in any industry or work which
is for a public purpose, the time within which, and the conditions on which, the
building or work shall be constructed or executed; and
•
where the acquisition is for the construction of any other work, the time within
which and the conditions on which the work shall be executed and maintained and
the terms on which the public shall be entitled to use the work.
A recent Supreme Court Judgment has significant implications for acquisition of land for
Companies.
17
The Supreme Court in this judgment dated 12.10.2007 has held that
acquisition of land by the State can be either for ‘Public Purpose’ or for a company and it
cannot be for both. It has been made clear that the distinction between acquisition of land
for public purpose and acquisition of land for companies is the “source of fund” for the
acquisition. The Court has made clear - after following the earlier decided cases on this point
- that where the entire cost for acquisition is being paid by the Company then the land
acquisition is for a company. Further, if the acquisition is for a company then the Land
Acquisition (Company) Rules, 1963 (1963 Rules) have to be followed as they are mandatory
17
Devinder Singh vs. State of Punjab, judgment dated 12.10.2007 in C.A No 4843 & 4844 of 2007
Background Paper
in nature. Under these 1963 Rules, the Collector after conducting an enquiry needs to submit
a report to the State Government on the following matters:
1 That the Company has made its best endeavours to find out lands in the locality suitable
for the purpose of acquisition; 2. That the Company has made all reasonable efforts to get
such lands by negotiation with the person entrusted therein on payments of reasonable price
and such efforts have failed; 3. That the land proposed to be acquired is suitable for the
purpose; 4. That the area of the land proposed to be acquired is not excessive; 5. That the
Company is in position to utilize the land expeditiously; and 6. Where the land proposed to
be acquired is good agricultural land that no alternative suitable site can be found so as to
avoid acquisition of that land.
The above overview shows that there are a series of policy and legal instruments at the
central level that if properly given effect to can serve the need for environmentally sound
and socially responsive infrastructure projects. The Supreme Court of India and the High
Courts have interpreted these instruments in the context of litigation involving large
infrastructure projects and the implications of the interventions of the Courts are discussed
next.
Background Paper
IV
INFRASTRUCTURE PROJECTS, SUSTAINABLE DEVELOPMENT AND THE
SUPREME COURT
The impact of intervention of the Supreme Court of India and the High Courts in large
infrastructure projects can be seen with reference to cases on river valley projects, thermal
power plants, mining projects, railway projects, tourism infrastructure and roads and
highways. Over the last two decades a very large number of public interest petitions got filed
to challenge large infrastructure projects including primarily Dams, Power and Mining
projects. The grounds of challenge had included adverse environmental impacts18, safety
aspects19, inadequate Environment Impact Assessment and Environment Management
Plan20, extraneous financial considerations21, forced displacement22 and inadequate
resettlement and rehabilitation measures23 arising there from. It would be seen that most of
the challenges to such projects have been mainly because all such projects require acquisition
of substantial areas of land and consequential displacement of a large number of people and
also involve substantial impact on the environment and ecology of the regions. This is
because large infrastructure projects will invariably have large impacts and due to the scale of
grievances, these cases merit separate and special attention.
Judicial Trends in Verdicts on Large Infrastructure Projects
In litigation against large infrastructure projects the courts have generally not ordered the
scraping of any project or any significant restructuring of a project in the face of such
The Society for Protection of Silent Valley v. Union of India (Unreported)
Tehri Bandh Virodhi Sangharsh Samiti V. State of U.P 1992 SUPP (1) SCC 44.
20 The Goa Foundation and Anr. V. The Konkan Railway Corporation and Others AIR 1992 BOM
471.
21 Centre for Public Interest Litigation V. Union of India, 78(1999) DLT 389.
22 See for instance Tehri Bandh Virodhi Sangharsh Samiti V. State of U.P 1992 SUPP (1) SCC 44
23 See for instance Karajan Jalasay Yojana Assargrasth Shakhar Ane Sangharsh Samiti V. Gujarat
(AIR 1987 SC 532
18
19
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challenges.24 The Courts have tended to take the view that considerations of environmental
impacts of a project or economic and financial considerations raised technical issues and
policy matters, which are best, left with the expert authorities of the executive.
25
For
example in a public interest petition where hydro power project and the proposed dam was
challenged on safety aspects, amongst other grounds, the Supreme Court noted that a high
level committee of the union executive had cleared the project and added that “It is not
possible to hold that the Union of India have not applied its mind to all possible
ramifications of the project. The case brings forth intricate questions relating to science and
engineering and the court does not possess the requisite expertise to deal with it”.26 This
position was amplified further by the Supreme Court in the well known Narmada Bachao
Andolan case where the Court made clear that “It is primarily for the government to consider
the importance of public projects for the betterment of the conditions of living of the
people” and added:
It is now well settled that the courts, in the exercise of their jurisdiction, will
not transgress into the field of policy decision. Whether to have an
infrastructural project or not and what is the type of project to be undertaken
and how it has to be executed, are part of policy making process and the
courts are ill equipped to adjudicate on a policy decision so undertaken. The
Court, no doubt, has a duty to see that in the undertaking of a decision, no
law is violated and people's fundamental rights are not transgressed upon
except to the extent permissible under the Constitution. Even then any
challenge to such a policy decision must be before the execution of the
project is undertaken. Any delay in the execution of the project means over
run in costs and the decision to undertake a project, if challenged after it's
execution has commenced, should be thrown out at the very threshold on
Tehri Bandh Virodhi Sangharsh Samiti v State of Uttar Pradesh (1992) Supp (1) SCC 44; Narmada
Bachao Andolan v Union of India AIR 2000 SC 3751.
25 For a detailed analysis of judicial trends in Large Infrastructure Projects Videh Upadhyay, Public
Interest Litigation in India: Concepts, Cases, Concerns; Lexis Nexis Butterworths, 2007
26 Tehri Bandh Virodhi Sangharsh Samiti v State of Uttar Pradesh (1992) Supp (1) SCC 44.
24
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the ground of latches if the petitioner had the knowledge of such a decision
and could have approached the Court at that time. Just because a petition is
termed as a PIL does not mean that ordinary principles applicable to
litigation will not apply. Latches is one of them.27
Invariably, in the cases of mega development projects, there has to be a fine
balancing act of two apparently equally well grounded competing claims and the way
the Court may respond in such a situation was shown in Narmada Bachao Andolan
where the Court observed:
For any project which is approved after due deliberation, the court should
refrain from being asked to review the decision just because a petitioner in
filing a public interest litigation alleges that such a decision should not have
been taken because an opposite view against the undertaking of the project,
which may have been considered by the government is possible. When two
or more options or views are possible and after considering them the
government takes a policy decision it is then not the function of the court to
go into the matter afresh and in a way sit in appeal over such a policy
decision.28
In respect of public projects and policies, which are initiated by the government, it
was also held that the court should not become an approval authority. Policy
decisions are taken by the government after due care and consideration and if a
considered policy decision has been taken, which is not in conflict with any law or is
not mala fide, it will not be in public interest to require the courts to go into and
investigate those areas which are the function of the executive.29 The observations of
the Court on stages of an infrastructural project and the limits of judicial review in
each of those stages are worth quoting in full here:
Narmada Bachao Andolan v Union of India AIR 2000 SC 3751 at Para 225
Narmada Bachao Andolan v Union of India AIR 2000 SC 3751 at Para 234
29 Narmada Bachao Andolan v Union of India AIR 2000 SC 3751
27
28
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There are three stages with regard to the undertaking of an infrastructural
project. One is conception or planning, second is decision to undertake the
project and the third is the execution of the project. The conception and the
decision to undertake a project is to be regarded as a policy decision. While
there is always a need for such projects not being unduly delayed, it is at the
same time expected that as thorough a study as is possible will be undertaken
before a decision is taken to start a project. Once such a considered decision
is taken, the proper execution of the same should be taken expeditiously. It is
for the Government to decide how to do its job. When it has put a system in
place for the execution of a project and such a system cannot be said to be
arbitrary, then the only role which a Court may have to play is to see that the
system works in the manner it was envisaged.30
Judicial Approaches to Project Affected Families (PAFs)
When the challenge to a dam or a river valley project is on the ground of displacement of
persons and lack of proper rehabilitation of the ousted, the courts have in several cases given
various directions including ensuring that the displaced persons get a proper opportunity to
establish and claim their rights.31 In some cases, the Supreme Court issued directions to
ensure that the oustees get an alternative land of equal quality or employment in lieu thereof
32
.. In other cases the Courts have stayed the involuntary displacement of the oustees and
hence the construction of the project until the Courts directions regarding rehabilitation of
30
Narmada Bachao Andolan v Union of India AIR 2000 SC 3751 at Para 223
Narmada Bachao Andolan v Union of India AIR 2000 SC 3751; Grameen Sewa Sasnstha v State of
MadhyaPradesh (1986) Supp SCC 578; Karan Jalasay Yojana Assargrasth Sahkar Ane Sangarsh Samiti
v State of Gujarat (1986) Supp SCC 350.
31
52 For example in Karan Jalasay Vs. State of Gujarat (AIR 1987 SC Page 532) the Court ordered that “
Simultaneously with taking the acquired land from any persons in the occupation of it, such persons shall
be provided with alternative land of equal quality but not exceeding three acres in area. If that is not
possible then alternative employment where he would be assured a minimum wage “ . Another example
include Banwasi Sewa Ashram Vs. State of UP & Ors AIR 1992 page 920.
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the oustees is complied with33. In a relatively lesser known case the Supreme Court issued
directions to ensure that the displaced get an alternative land of equal quality or employment
in lieu thereof.34In that case land was acquired by the government of the State of Gujarat for
submersion for the construction of a dam across river Karajan. A public interest litigation
was filed in protest against which the court ordered an interim stay on the land acquisition.
In an appeal for vacation of the stay order, the court observed that though the land had been
acquired for an important public purpose, the human problem, arising out of displacement
of large number of tribes and other persons belonging to weaker sections on account of
acquisition of land, could not be overlooked.35
Supreme Court Generally on Principles of Sustainable Development
In a landmark environmental case the Supreme Court held that “Some of the salient
principles of ‘Sustainable Development’, as culled out from Brundtland Report and other
international documents, are Inter-Generational Equity, Use and Conservation of Natural
Resources, Environmental Protection, the Precautionary Principle, Polluter Pays Principle,
Obligation to Assist and Cooperate, Eradication of Poverty and Financial Assistance to the
developing countries.”36 The Court then added ‘The Precautionary Principle’ and ‘The
Polluter Pays Principle’ are essential features of ‘Sustainable Development’ and explained
that ‘The Precautionary Principle’ — in the context of the municipal law — means:
(i) Environmental measures — by the State Government and the statutory
authorities — must anticipate, prevent and attack the causes of environmental
degradation.
(ii) Where there are threats of serious and irreversible damage, lack of scientific
certainty should not be used as a reason for postponing measures to prevent
environmental degradation.
33
Karan Jalasay Vs. State of Gujarat (AIR 1987 SC Page 532) , Narmada Bachao Andolan V. Union of
India AIR 2000 SC 3751.
34
35
36
Karan Jalasay v State of Gujarat AIR 1987 SC 532
Karan Jalasay v State of Gujarat AIR 1987 SC 532
Indian Council for Enviro-Legal Action v. Union of India, (1996) 3 SCC 212
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(iii) The ‘Onus of proof’ is on the actor or the developer/ industrialist to show
that his action is environmentally benign.
‘The Polluter Pays Principle’ has been held to be a sound principle by the Court
and this has been explained as follows: ‘... once the activity carried on is hazardous
or inherently dangerous, the person carrying on such activity is liable to make good
the loss caused to any other person by his activity irrespective of the fact whether he
took reasonable care while carrying on his activity. The rule is premised upon the
very nature of the activity carried on…..Consequently the polluting industries are
‘absolutely liable to compensate for the harm caused by them to villagers in the
affected area, to the soil and to the underground water and hence, they are bound to
take all necessary measures to remove sludge and other pollutants lying in the
affected areas’. The ‘Polluter Pays Principle’ as interpreted by this Court means that
the absolute liability for harm to the environment extends not only to compensate
the victims of pollution but also the cost of restoring the environmental degradation.
Remediation of the damaged environment is part of the process of ‘Sustainable
Development’ and as such the polluter is liable to pay the cost to the individual
sufferers as well as the cost of reversing the damaged ecology.37
The Precautionary Principle and the Polluter Pays Principle have since been accepted by the
Supreme Court as part of the law of the land in India.
Role of Commissions in determining Competing Claims in Large Projects and
Moving towards Environmental Courts
In cases relating to large projects, courts have performed a balancing act between competing
assertions for the need of development and the imperatives of livelihood concerns,
resettlement, rehabilitation and ecological issues.38 Here, the courts have repeatedly resorted
to commissions for expert opinion on the fact situation on the ground specifically created
37
Indian Council for Enviro-Legal Action v. Union of India, (1996) 3 SCC 212
In all the major public interest litigation on mining, large dams and thermal power projects the
courts have articulated the need to strike the necessary balance.
38
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for the said purpose The need to rely on a specialized opinion arose because the questions
raised in the public interest petitions were highly intricate questions relating to science and
engineering.39 In some cases, the court while giving its final verdict, have relied upon only
the technical expert bodies of the government, which had examined the matter.40 However,
in certain other cases, the courts have at one point indicated the need for appointment of an
independent high power committee despite the fact the government had already appointed a
committee for the same purpose of examining rights of the tribes residing in the forest areas
of the proposed thermal power project.41 As against this, in a number of other cases
especially on mining projects and on large dams, the courts have relied upon the reports of
independent expert committees appointed by it for the specific purpose.42
The Law Commission in its 186th Report pursuant to the judgment of the Supreme Court of
India has inter-alia recommended establishment of environmental courts in each State,
consisting of judicial and scientific experts in the field of environment for dealing with
environmental disputes besides having appellate jurisdiction in respect of appeals under the
various pollution control laws.43 The Commission has also recommended repeal of the
National Environment Tribunal Act, 1995 and the National Environment Appellate
Authority Act, 1997 after environment courts have been set up. The Ministry has decided to
implement the recommendation of the Law Commission and the draft proposal has been
sent to the Legislative Department, Ministry of Law & Justice for formulation of the Bill.
39
Tehri Bandh Virodhi Sangharsh Samiti v State of Uttar Pradesh (1992) Supp (1) SCC 44.
40 Se for example Tehri Bandh Virodhi Sangharsh Samiti v State of Uttar Pradesh (1992) Supp (1)
SCC 44;
41 Banwasi Sewa Ashram v State of Uttar Pradesh AIR 1987 SC 374
42 Rural Litigation and Entitlement Kendra v State of Uttar Pradesh AIR 1988 SC 2187.
43
The Supreme Court judgment that prompted this action was in the matter of A.P. Pollution Control Board
v Prof. M.V. Nayudu (Reported in 1992(2) SCC 718 and 2001(2) SCC 62)
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V
SUSTAINABLE DEVELOPMENT IN SPECIFIC INFRASTRUCTURE
SECTORS: POLICY, PRACTICE AND REGULATORY PERSPECTIVES
With the nature of issues relating to large infrastructure projects identified as above the
Convention aims at exploring the questions in specific infrastructure sectors including Large
Civil Construction Projects, Energy Infrastructure, Large Transport Projects and Projects on Public Private
Partnerships. Each of these Sectors has both sector specific issues and also show cross cutting
issues that can be shared across these sectors. An overview of the nature of issues in
sustainable development that each one of them raises has been attempted here.
POLICY AND REGULATORY PERSPECTIVES IN SUSTAINABLE LARGE
CIVIL CONSTRUCTION PROJECTS
Large civil construction projects needs to be mapped closely from the standpoint of
sustainable development while drawing implications for regulatory and policy frameworks in
the sector.
Construction engineers, planners and decision makers behind large civil
construction infrastructure projects need to be aware of the effects of planning, design, and
construction on our environment. Some natural questions arise in this context: What is the
Indian construction industry doing to reduce its environment footprint? Are policy and legal
frameworks enabling development of tool for environmentally-conscious design,
construction and management and reuse and recycling options on construction materials,
and do they make environmental and economic sense? Besides, all large civil construction
projects entail social consequences too. Do the existing approaches adequately take care of
the requirements for rehabilitation and resettlement of the affected people? In addition to
the environmental and social issues large civil construction projects like Dams also tend to
face an element of financial risk due to long gestation period, increase in time and cost of
project due to geological surprises and these raises critical issues on economic dimensions of
Background Paper
sustainability of such projects. The Convention shall aim at throwing light on some of the
emerging concerns in this area too.
In addition to the questions above the Convention shall deliberate upon the role and impact
of the Environmental Impact Assessment Notification, 2006 to the civil construction
industry. Prior Environment Clearance from the Ministry of Environment and Forests,
Government of India, is mandatory for ‘Building and Construction projects’ and ‘All
Townships and Area Development Projects’ that require large civil construction works if
they are above threshold limits under the Environment Impact Assessment Notification
2006. The projects at the state level requiring an Environmental Impact Assessment
report are termed Category ‘B1’ projects under the EIA Notification 2006 and All
Townships and Area Development Projects covering an area of 50 ha or more and or
built up area 1,50,000 sq .mtrs or more are such ‘B1’ projects. When it comes to cement
plants, all cement plants with over 1.0 million tonnes/annum production capacity, being
‘Category A’ projects under the EIA Notification, 2006, require clearance at the central level
whereas plants with less than that capacity are Category B projects with environment
clearance required at the State level. All “Stand alone grinding units” can also get clearance at
State level. At the State level the prior environmental clearance needs to be procured from
recently constituted State/Union territory Environment Impact Assessment Authority
(SEIAA) under the EIA Notification 2006.
Business leaders from the cement and the construction industry across the globe are
conscious of the need to respond to the change of sustainable development. In this context
the efforts of the Cement Sustainability Initiative (CSI) formed to help the cement industry to
address the challenges of sustainable development are noteworthy. The business leaders of a
group of major cement companies lead the initiative and its purpose is to: explore what
sustainable development means for the cement industry; identify and facilitate actions that
companies can take as a group and individually to accelerate the move towards sustainable
development; provide a framework through which other cement companies can participate
and provide a framework for working with external stakeholders. Initiatives like these offer
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hope for the future. Another initiative by the Cement giant Lafarge and its partnership with
WWF is remarkable and is presented briefly in the Box below.
Cementing Partnerships and Future: Lafarge Partnership with WWF
Suggests the Way Ahead
Concrete is the most used material worldwide. Sixty percent of Lafarge's CO2 emissions
come from the chemical transformation of limestone into lime at high temperatures to create
cement. Lafarge has signed a pioneering partnership with WWF to improve its
environmental performance and contribute to raising standards in the cement industry.
Lafarge’s environmental policy has increasingly emphasized the development of long-term
dialogue with its stakeholders and the establishment of a genuine partnership with society.
The best illustration of this is the pioneering partnership it signed in March 2000 with WWF,
the aim of which is to improve its environmental performance and contribute to raising
standards in industry. In 2005, this partnership was renewed for a further three years
With the aim of highlighting areas for priority action and monitoring its progress on
environmental issues, the Lafarge Group has identified the most relevant environmental
performance indicators in conjunction with WWF and defined quantified targets for
improvement for each division according to a detailed calendar. These indicators make it
possible to assess progress achieved in the protection of the environment, and guarantee the
transparency of the actions carried out by Lafarge.
Source: http://www.wbcsd.org/plugins/DocSearch/details
Sustaining Large Dams -Mechanisms for Safeguarding Environmental and Social
Rights: When we think of large scale civil construction works large Dams naturally comes
to mind. The multifaceted issues surrounding large dams are the source of immense debate
among scholars, technical experts, social justice advocates, development professionals,
politicians, and engineers. Though essential to development through the provision of water
Background Paper
supply, hydropower production, river transport, and flood control, if badly planned and
managed large Dams can also have significant deleterious effects on the environment and
social wellbeing.
Large dam construction has been a key aspect of India’s planning over the last 50 years. But
what is the process by which such projects are conceptualized, approved and eventually
constructed? What are the mechanisms by which environmental and social rights are
safeguarded?44 In brief the major mechanisms include:
Site clearance: Hydro power projects are site-specific and, therefore, require site clearance from
the MoEF. The project proponent has to provide basic technological, geological,
seismological, topographical, archaeological and demographical information on the project
site, the catchment and the command area.
Social Impact Assessment and Rehabilitation plan: If the project is seen to disturb too large a
population, then it is often not considered worthy of site clearance. For large rehabilitations,
the resettlement plans have to also get the approval of the concerned administrative
ministries. For example, if there is displacement of a tribal village population, then the tribal
resettlement plan must also get a nod from the Tribal Welfare Ministry of the government of
India before environmental clearance is granted.
Wildlife impacts: If the project is expected to cause submergence of a wildlife sanctuary or
national park, it is referred to the Indian Board for Wildlife (IBWL), a body consisting of
conservationists and government functionaries. A Supreme Court ruling in the PIL filed by
the World Wildlife Fund has made clearance from the IBWL mandatory for any
denotification of a sanctuary or national park.
Environmental impact assessment: After the project is accorded site clearance, the project
authorities are permitted to undertake a detailed survey and investigation based on which
techno-economic and environmental clearances are accorded. In order to start the process of
environmental clearance, the project proponents have to submit an Environmental Impact
Assessment (EIA) report based on data gathered over a period of at least one year
44 For a detailed exposition of these Mechanisms See, Promode Kant, Clearance of large hydel projects:
environmental procedures and considerations (unpublished)
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encompassing all seasons to brings out the likely impact of the project on the ecology,
environment, human and wildlife populations, at the site itself and both up and downstream.
Environmental management plan: All EIAs require an Environment Management Plan (EMP)
for the formulation, implementation and monitoring of environmental protection measures
during and after the commissioning of the project.
Risk assessment: In a hydro power project, the greatest risk is the possibility of a dam break.
Other risks include dam-induced floods and landslides caused by roads and other
constructions. Dam break analysis is an integral part of the project’s techno-economic
appraisal. A competent EIA examines the possibility of dam break and the likely immediate
and long-term effects on the land, fauna and flora.45
Strategies to prevent and deal with
such disasters are part of the Disaster Management Plan, which is necessary to obtain
technical clearance from the Ministry of Power.
Forest Clearance for Diversion of Forest Land: The Forest (Conservation) Act 1980 was enacted as
central legislation to check indiscriminate diversion of forestland. Under this legislation,
approval of the Central Government is required before any forestland (noted as such in
Government
records)
is
diverted
for
non-forestry
purposes.
Any
person/organization/company/Department making a request for diversion or denotification of forest land for non-forest purpose needs to follow the procedures laid down
under the Forest (Conservation) Rules, 2003 under the Forest Conservation Act, 1980.
These provisions apply as much to Dams as to any other infrastructure projects that extends
to forest land.
It should be clear for the above Large Dams need to be planned well for them to be both
environmentally sound and socially responsive. Optimum use of the instruments above can
help achieves this. The Supreme Court of India ahs also decisively pointed out the value of
the large dams in the Indian context in the words below from a landmark case:
Other risks are related to defence against external aggression and sabotage by terrorists, for which
the Defence Ministry is consulted on the advisability of situating a huge water body in the
neighbourhood of sensitive international borders.
45
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Since long the people of India have been deriving the benefits of the river valley
projects………For example residence of villages around Bhakra Nangal Dam,
Nagarjun Sagar Dam, Tehri, Bhillai Steel Plant, Bokaro and Bala Iron and Steel
Plant and numerous other developmental sites are better off than people living in
villages in whose vicinity no development project came in……….So far a number
such river valley projects have been undertaken in all parts of India. The petitioner
has not been able to point out a single instance where the construction of a Dam
has, on the whole, had an adverse environmental impact. On the contrary the
environment has improved. That being so there is no reason to suspect, with all the
experience gained so far, that the position here will be any different and there will
not be overall improvement and prosperity46.
POLICY AND REGULATORY PERSPECTIVES IN SUSTAINABLE AND
LARGE ENERGY INFRASTRUCTURE PROJECTS
The present Convention shall also aim to focus on the sustainability impacts of the Hydro
and Thermal power projects and Oil and Gas infrastructure projects.
Power Projects: A number of ongoing projects including hydro projects, multi purpose
river valley projects, Ultra Mega Power Projects (UMPPs), amongst others, point to a
growing sensitivity to the environment problems, rehabilitation and social impact associated
with these projects. However, given that over 90,000 MW of new generation capacity is
required in the next seven years with a corresponding investment in transmission and
distribution networks the country need these projects to come through. Thus it is critical to
examine issues that can help sustain these projects. The Convention shall explore these
concerns while assessing the impact of recent legal and policy instruments discussed above
like the EIA Notification, 2006 and National Policy on Rehabilitation and Resettlement 2007
on the environmental and social sustainability of such projects. The role of sector specific
46
Narmada Bachao Andolan V. Union of India, AIR 2000 SC 3751.
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laws and regulations in promoting sustainable energy projects as also cross-cutting laws like
the Energy Conservation Act, 2001 and Draft Renewable Energy law can also be closely
examined.
The position of River Valley Projects and of Thermal Power Plants under the EIA
Notification, 2006 may be noted. All River Valley projects which have a capacity of over 50
MW hydroelectric power generation and has over 10,000 ha. of culturable command area
need to get clearance from the Ministry of Environment and Forest at the central level being
category ‘A’ Projects under the EIA Notification 2006, whereas those having a capacity of
over 25MW hydroelectric power generation are Category ‘B’ projects needing clearance from
the State level. When it comes to Thermal Power Plants projects having a capacity of over
500 MW (in case of coal/lignite/naphta & gas based projects) and over 50 MW (in case of
Pet coke diesel and all other fuels ) are category A projects meaning thereby that they shall
need to get clearance from the Ministry of Environment and Forest, Government of India
while projects with lesser thresholds are Category ‘B’ projects needing clearance from the
State level.
Even while the above represents the ‘thresholds’ for carrying out an EIA and seeking prior
environment clearance under the applicable law what exactly goes in putting together a
credible EIA and R&R Practice is represented best with the example in the Box below:
Hydro Electric Power Projects: An example of a range of EIA and R&R Practices
from the Practices of the National Hydroelectric Power Corporation Ltd. (NHPC)
National Hydroelectric Power Corporation Ltd. (NHPC), since its inception, is committed
for hydropower generation in an environmentally sustainable and socially responsive
manner. In order to achieve the objective of sustainable development, Environmental
Impact Assessment (EIA) is carried out for every project. Problems related to deforestation,
soil erosion, sedimentation/siltation, flood control, fisheries and fish migration, terrestrial
and aquatic ecosystems, rare and endangered species of plants/animals, socioeconomic/socio-cultural and archaeological factors, resettlement & rehabilitation, public
health etc. are looked into and suitable addressed in the EIA & EMP Reports which are
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apprised by MOEF while according environmental clearance to a project. The Management
Plans are framed up and implemented to minimize or offset any adverse impact of project
construction on the environment.
As and when required, the assistance of other
environmental experts/institutes is also taken to supplement the efforts put in by the
organization for the purpose. Major thrust areas of NHPC in the field of Environmental
Management include the following:
Catchment Area Treatment (CAT) to counter the menace of soil erosion and landslides,
resulting from unplanned human activities, deforestation, human and animal interventions in
the past and present etc. This aspect is important to be addressed as soil erosion results in
siltation of the reservoir which results in reduction of the water holding capacity of the
reservoir, ultimately encroaching upon the efficiency of a project.
Compensatory Afforestation in lieu of the forest land to be diverted for project construction.
Green Belt Development around the project appurtenances, office and residential complexes
roads etc.
Reservoir Rim Treatment to treat the active landslide and shear zones around the reservoir
periphery through engineering and biological measures.
Landscaping and restoration of the dumping, quarrying and construction areas.
Solid Waste Management; Biodiversity conservation; Conservation and Management of fishes; Water
Quality Assessment;Dam Break Analysis and preparation of Emergency Action Plan.
R&R package for Project Affected Families (PAF) is also assessed and approved by the Expert
Appraisal Committee (EAC) of Ministry of Environment & Forest. A detailed socioeconomic survey is conducted before formulation of R&R Plan for the PAFs so as to assess
the socio-economic and socio-cultural set-up of the affected persons and local people. In
places where ethnic minorities dominate, as in case of Teesta V HE Project in Sikkim, a
separate Ethnographic Survey is conducted to understand the local culture and behaviour of
the people. After getting approval from MOEF or from the concerned Department of the
State Government, the Plan is set for implementation by NHPC in close coordination with
the District Administration.
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Oil and Gas Infrastructure Projects: When it comes to Oil and Gas Infrastructure some
threshold questions can be deliberated upon: are laws and policies helping promote oil
recovery rates while conserving oil and gas resources? Are existing frameworks for Health,
Safety and Environment (HSE) adequate or are there issues in their due compliance? It shall
be useful in this light to explore best industry practices in dealing with environment and
social issues arising from the project and how the industry fares on its HSE commitments
including larger efforts of the industry to integrate projects into local communities.
The technological processes of exploration, production, processing, storage, and
transportation of oil and natural gas are highly complex and demanding. Multiple
interconnected technological systems are applied. In each of the systems, despite good faith
efforts to comply with environmental laws and regulations, incidents may occur that result in
the contamination and pollution of the environment. Protection and improvement of human
working and living environments through the application of optimized technological
methods, processes, materials, equipment, and best quality solutions in the course of basic
operations are needed today.
Oil exploration and development as an economic activity is being conducted pursuant to a
Governmental policy formulation and is an activity in which the State is a key stakeholder.
These activities need to be seen from the standpoint of energy security concerns of our
country. The Oil and Gas Sector, especially the upstream activity, is on the high priority list
of Government of India and it considers the Exploration and Development of Hydrocarbon
as one of its most important policy initiatives. The Model contract formulated by the
Government of India assumes that time is of essence in the conduct of such upstream
activity. It also imposes critical obligation on the contracting parties to meet its contractual
commitments in a timely, efficient and prudent manner. Any unwarranted delay in procuring
clearances can jeopardize a Project with adverse consequences for future field development
programs.
While intensive oil exploration in the times ahead is imperative - having a large bearing on
our stated national policy of effectively monetizing the hydrocarbon opportunity in the
Background Paper
socio-economic interest of our nation - it cannot come at an irreversible ecological loss.
Under the EIA Notification 2006, Offshore and onshore oil and gas exploration,
development & production require clearance from the Union Ministry of Environment and
Forests, Government of India. However, Exploration Surveys (not involving drilling) are
exempted from seeking clearance. Further, all Oil & gas transportation pipe line (crude and
refinery/ petrochemical products), passing through national parks /sanctuaries/coral reefs
/ecologically sensitive areas including LNG Terminal require clearance from the Union
Ministry of Environment and Forests. The same applies to Petroleum refining industry and
Petro-chemical complexes (industries based on processing of petroleum fractions & natural
gas and/or reforming to aromatics). Apart from these under the ‘Production Sharing
Contract’ (PSC) too both the Government and the Contractor recognize that Petroleum
Operations will cause some impact on the environment in the Contract Area.
Accordingly, a typical PSC also stipulates that ‘in performance of the Contract, the
Contractor shall conduct its Petroleum Operations with due regard to concerns with
respect to protection of the environment and conservation of natural resources’.
POLICY AND REGULATORY PERSPECTIVES IN SUSTAINABLE AND
LARGE TRANSPORT PROJECTS
Large Transport Projects like intra state and interstate highways have also recently witnessed
problems in land acquisition, right-of-way issues, resettlement and rehabilitation of affected
people and in environmental clearances. In this context a sustainable development approach
merits that developer, planning authorities and government agencies work towards resolving
these issues together. If the projects comply with the Government's development plans and
the plans of the local urban and rural authorities and bodies they may tide over the
environmental and social issues.
Best practices, nationally and internationally, can throw more light on these issues. The
Highways agency of the UK Government for example is engaged in widespread consultation
on their projects and work under a six fold criteria of effective consultation which is
Background Paper
mandated by the Code on Consultation of the UK Cabinet.47 One example of a recent
consultation was on ‘Efficiency Gains from Collaborative Roads Procurement’ whereby
people themselves identified biggest issues or constraints affecting collaboration and the
effort at maximizing benefits from working together with the people on various fronts
including - maximizing the benefits of investment in procurement, greater buying power ,
better use of resources, improved accountability improved performance measurement and
also integrating longer term strategy with programme delivery, amongst others.48 The merit
in having a more collective approach in roads planning and management perhaps needs
greater realization in the Indian context.
Even while more sophisticated regulatory approaches may be helpful as we move ahead, the
Highways Departments at the State level show conscious of the imperative need for
approaching projects from the standpoint of sustainable development if vision statements in
their Citizens Charter can be seen as reflecting their thinking. Thus for example the
Taminadu Governments’ Highways Department envisions in its Citizens’ Charter thus: "To
serve our customers, the road users of Tamilnadu by providing high quality, cost effective,
environmental friendly road network that is reliable and safe contributing to sustainable
economic development and social well being of the state by applying innovation, best
These six criteria include - 1. Consult widely throughout the process, allowing a minimum of 12
weeks for written consultation at least once during the development of the policy. 2. Be clear about
what your proposals are, who may be affected, what questions are being asked and the timescale for
responses.3. Ensure that your consultation is clear, concise and widely accessible.4. Give feedback
regarding the responses received and how the consultation process influenced the policy.5. Monitor
your department’s effectiveness at consultation, including through the use of a designated
consultation co-ordinator.6. Ensure your consultation follows better regulation best practice,
including carrying out a Regulatory Impact Assessment if appropriate. The Code adds that ‘These
criteria must be reproduced within all consultation documents.’ See ‘The Code of Practice on Consultation’
Cabinet Office, Government of UK.
47
For more details in this regard including questionnaires developed by the Highway Agency for
consultation see http://www.highways.gov.uk/roads/ The Agency clarifies that the anonymity of
respondents will be protected before any information received is passed on to Highways Agency staff
or our agents, and before any findings are published, unless respondents request action to the
contrary.
48
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practices, appropriate technology and responsible management of internal and external
resources.49
Talking of Roads and Highways one feels that more proactive approaches can still be more
useful. For example the Resettlement & Rehabilitation Policy applicable to the Project and
the specific Corridor specific Resettlement Action Plans (RAPs) needs to be put at all
accessible points including project website but also at the offices of the Gram Panchayat,
Block and the District Panchayats as also with the Block Development Officer and the
Deputy Commissioner. Besides, information on all major rights and entitlements with special
reference to PAP need to be made available at all these places.
There has been a growing concern given that the infrastructure in the metro and major nonmetro Airports is under strain that India has been playing “catch-up” in the development of
its Aviation infrastructure. To cope with quantum jumps in projected traffic the Central and
State Governments, the Airport Authority of India and the private sector and the investors
need to all pitch in to build the Airport Infrastructure. At present all Airport Projects need
the clearance from the Union Ministry of Environment and Forests, Government of India
under the EIA Notification, 2006. To tide over the project delays in the sector the
Government of India has been contemplating relaxing environment clearance norms for
expansion and modernization of airports while continuing to mandate a rigorous clearance
process for green field projects.
Should this also have implications for social Impact
Assessment (SIA) of the Projects? Apart from the major airports it is estimated that at least
300 airports and airstrips can be revived and commissioned with some efforts though this
will entail a tremendous synergy of efforts between Centre and States and between the
aviation and tourism sectors.50 Given this context it imperative to address issues in
sustainability of projects in aviation infrastructure and the Convention hopes to throw
pointers on the emerging issues here.
See the vision Statement in the Citizens’ Charter of the High way Department, Government of
Tamilnadu.
50 See Aviation Infrastructure: Project Delays Prove Costly, Survey of the Indian Industry 2008,The Hindu
49
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Before parting with this section on large Transport projects a couple of recommendations of
the Policy Consultation Forum of the United Nations Economic and Social Commission for Asia
and the Pacific on ‘Promoting Sustainable Infrastructure Development’ is worth mentioning
here. The Commission felt that in the Asia and the Pacific region(a) It is necessary to work towards improving the eco-efficiency of transport sector
by developing and realizing an appropriate vision of eco-efficient and sustainable
transport firmly rooted in the concept of green growth; and
(b) Regional approach to promote eco-efficient and sustainable transport is needed,
in such areas as regulation, technology, and innovation. In order to move towards
eco-efficient transport systems, it is necessary for the countries in the region to
develop guidelines for eco-efficient and sustainable transport based on local traffic
and land use conditions.
It should be clear that the merit of these suggestions for sustainable transport infrastructure
especially in the Indian context cannot be denied.
Projects on Public Private Partnerships –As Keys to Sustainable Development
Stakeholders participation is one of the key features of sustainable development and here
exploring the emerging issues in large projects on Public Private Partnerships shall be
specifically addressed in one session of the Conference. A Public Private Partnership (PPP)
Project means a ‘project based on a contract or concession agreement, between a
Government or a statutory entity on the one side and a Private Sector Company on the
other-side, for delivering an infrastructure service on payment of user charges’51 Some of the
key concerns on sustainability of large PPP projects in the Indian Railways – on sheer size
some see the Indian Railways to be sector or even a government in itself – can be a special
theme under the Convention. The Officer on Special Duty to the Minister of Railways in a
conference last year had explained that their interest in PPPs is not driven by financial
compulsions but that they would be “keen to enter into PPPs as it would help them harness
As defined in the scheme of the India Infrastructure Finance Company Limited and available at
http://www.iifcl.org/schemes.html
51
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the private sector’s efficiency and rapidly infuse world-class technology.”52 While Railways
have successful PPP Initiatives, for example, in Catering it is the involvement of the private
players in substantive capacity augmentation by way of more locomotives, coaches and
networks that could be addressed especially in the convention -being in line with the
conference theme on large projects. Ironing out the PPP mode in these areas of the Indian
Railways and exploring whether there is a need for strengthening the regulatory and policy
framework could also be explored here. The issues of removing encumbrances and
encroachments on Railway land including strengthening legal powers in this regard and of
due rehabilitation of those affected by acquisition of land for green field projects are themes
that can help make the Railways projects socially responsible.
A FINAL WORD AS A BACKGROUNDER TO THE INTERNATIONAL
CONVENTION
It has been discussed in the foregoing that planning and execution, operation and
maintenance of Infrastructure projects should aim to address at all stages all dimensions of
sustainable development – economic, environmental, social and cultural. This in turn means
extending the boundaries of consideration beyond the immediate resources used in
providing infrastructure. The preceding sections in the paper has also shown that there are a
series of policy and legal instruments at the Central and the State levels that, if properly given
effect to, can serve the need for environmentally sound and socially responsive infrastructure
projects. There has also been a discussion in the pages above on various sectors of the
large infrastructure projects to seek answers to the big question of making large
infrastructure projects environmentally sound, socially responsible, and sustainable by
regulation. The Convention shall pick on each of the above themes and discuss them in
the context of specific infrastructure sectors identified above. The discussion on the
themes within each of the identified sectors shall serve to highlight the role of policy and
law makers, the public and the private sectors and the voluntary organizations
Statement made at the International Conference on Meeting India’s Infrastructure Needs with
Public Private Partnerships, Ministry of Finance, Government of India.
52
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representing the interests of the ‘citizen-consumer’ and all the stakeholders. A detailed,
close, in-depth and enlightening brainstorming on the subject is overdue. This
brainstorming is also needed as the process of translating strategic sustainability objectives
into concrete action at project-specific levels is a difficult task. The multi-dimensional
perspectives of sustainability such as economy, society, environment, combined with a lack
of structured methodology and information at various hierarchical levels, further exacerbate
the problem.53 Some very crucial suggestions as a way ahead has been provided by the Policy
Consultation Forum of the United Nations Economic and Social Commission for Asia and
the Pacific on ‘Promoting Sustainable Infrastructure Development’ and these have been
discussed above. Three specific conclusions of the Forum not discussed above deserve to be
stated here in view of there strategic significance in promoting sustainable infrastructure.54
These include • A holistic approach is needed in infrastructure development, considering both
consumption and production aspects, physical and non-physical aspects, different
stages of infrastructure development, different levels of organizations, and role of
different stakeholders;
• The technical expertise of the private sector in development of infrastructure will
definitely be beneficial. However, the private participation does not automatically
guarantee the promotion of sustainable infrastructure. The private participation in
infrastructure development needs to be carefully evaluated and scrutinized;
• It is necessary to develop strategies for attitude change, including education and
awareness raising and ensuring decision making processes that give conscious
attention to environmental and social objectives.
See O.O. Ugwu, M.M. Kumaraswamy, A. Wong and S.T. Ng, Sustainability Appraisal in
Infrastructure Projects: Development of Indicators and Computational Methods available at
http://www.sciencedirect.com/science. The paper proposes an analytical decision model and a
structured methodology for sustainability appraisal in infrastructure projects.
53
54
Report of the First Policy Consultation Forum of the Seoul Initiative on Green Growth on
“Promoting Sustainable Infrastructure Development” under the aegis of the UNITED NATIONS
ECONOMIC AND SOCIAL COMMISSION FOR ASIA AND THE PACIFIC, September 2006
Background Paper
The points made above by the United Nations Economic and Social Commission for Asia and the
Pacific need to be well taken and should serve to show that there is a lot to be done as we
tread on the path of making large infrastructure projects sustainable. It has been said before
that sustainable development is a marathon, not a sprint. In the marathon ahead there has to
be growing recognition and realization of the need to have an infrastructure policy that
concerns itself with efficiency of resource use so as to obtain more from less, to reduce
ecological footprint while also being socially inclusive. That is the way ahead.
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