Anil Agarwal's Vedanta Resources group which has operations from zinc mining to copper smelting has exited from the London Stock Exchange following a hue and cry over its controversial listings. When the decision to delist was taken, the central London venue was picketed by protesters accusing the company of malpractice and condemning UK authorities for failing to hold it to account. Since the early days of its presence in London, Vedanta has faced scrutiny of its social and environmental record, culminating in an international outcry this year when police shot dead 12 people protesting about its copper plant in Tuticorin, Tamil Nadu.
The Vedanta founder believes his group will be an important player in India’s economic growth. But his group remains a target of criticism over its social and environmental record. Vedanta-owned copper smelter in Tamil Nadu has been blamed for causing cancer and other diseases over two decades. Opponents of the copper smelter have decried a pattern in which Vedanta had repeatedly been sanctioned for breaching pollution laws, only to be permitted to continue operations. Concerns about its practices at Lanjigarh and elsewhere have continued to weigh on Vedanta’s reputation among investors. In 2013 it was ordered to suspend operations in India after a major gas leak, but was later given permission to reopen.
Vedanta’s London listing, meanwhile, ensured that the bloodshed in Tuticorin rippled far beyond India, reigniting scrutiny in the UK, where John McDonnell, the shadow chancellor, called for its delisting. Vedanta faced an outcry over its plans to source bauxite for a new alumina refinery at Lanjigarh from the Niyamgiri hills in eastern Odisha state, which are sacred to some local tribal people.
The legal action argues that Vedanta has repeatedly flouted the law by undertaking construction work without permission, while noting persistent local complaints about health problems allegedly caused by pollution. Vedanta rejects the criticisms. Yet concerns about its practices have continued to weigh on Vedanta’s reputation among investors. Vedanta also faced problems in Zambia. UK Supreme Court will rule on whether 2,000 Zambian villagers are entitled to sue Vedanta in London over pollution caused by its subsidiary. In March, India’s Supreme Court ordered a total shutdown of iron ore mining in Goa, where Vedanta’s Sesa Goa unit is by far the biggest operator. “Vedanta has an obvious governance problem,” says Bhushan.
