India Needs Copper - But Tamil Nadu Destroys Copper Project

Sterlite Copper unit which was set up over a decade back in Tamil Nadu  was closed and re opened more than once due to environmental issues raised by some activists.

by N.S.Venkataraman

It is reported in the media that NITI Aayog member V.K.Saraswat has pitched for providing a   production linked incentive ( PLI) scheme to the copper sector,  stating  that primary copper production is critical for India to be an export hub. 

The above statement is surprising , since Sterlite Copper , a large copper unit has been  forced to remain closed for over four years now in Tuticorin in Tamil Nadu and the subject is before the Supreme Court for decision  regarding  reopening  the unit.

Indian Copper scenario :

There are three copper smelter units set up in India namely Hindalco at Dahej, Gujarat with installed capacity of 5 lakh tonne per annum, Sterlite Copper at Tuticorin , Tamil Nadu with installed capacity of 4 lakh tonne per annum and Hindustan Copper Ltd. with much smaller capacity.

Hindustan Copper Ltd produces copper metal from the ore produced at their captive mines. Sterlite Copper  and Hindalco Industries Ltd have been producing  copper metal from imported copper concentrates.

Sterlite Copper Unit:

Sterlite Copper unit which was set up over a decade back in Tamil Nadu  was closed and re opened more than once due to environmental issues raised by some activists.

Sterlite Copper has consistently said that it has not violated any environmental norms. National Green Tribunal confirmed that if there   was any environmental issue in Tuticorin region, it has not been due to Sterlite Copper but for other reasons. National Green Tribunal permitted the operation of Sterlite Copper.  However, due to violent agitation by the activists , the Sterlite Copper unit was ordered to be  closed by Tamil Nadu Government  in May,2018.

While the unit has not been in operation for over four years now, a few  investigation   team  including  from Anna University have  confirmed after detailed study that there have been no change in the environmental condition in Tuticorin region after the closure of Sterlite Copper unit. Obviously, this means that Sterlite Copper Unit has not been responsible for causing any environmental issue in the region.

When Serlite Copper was operating, it was   meeting   around 33% of India’s requirement of copper ,  with annual copper demand of around 6,30 000 tonne per annum in India.

When Sterlite Copper was operating, India was exporting copper.  After the stoppage of production of Sterlite Copper, India is now importing   copper and India is now net importer of Copper  with huge outflow  of foreign exchange .  In the global market, Chinese coper units gained considerably due to the stoppage of copper export from India.

What future for Sterlite Copper?

It is now not clear as to what would be the future of Sterlite Copper plant in Tuticorin , since the matter is before the Supreme Court.

However, it appears that the motivated activists  protesting against Sterlite Copper operation and the politicians  belonging to the ruling party and their allies in Tamil Nadu appear to be determined not to permit the resumption of operation of Sterlite Copper.

Due to the closure of Sterlite Copper  unit , around 2000 direct employees   and around 7000 indirect employees such as workers  employed by the contractors have lost the job. They have repeatedly appealed to the Government of Tamil Nadu to reopen Sterlite Copper unit.

A number of   residents  living in Tuticorin and surrounding areas  have also appealed to Tamil Nadu government to reopen Sterlite Copper, as the continued closure is adversely impacting the economy in the region. Number of them confirmed that they have not been affected due to operation of Sterlite Copper.

Shift the Sterlite Copper  unit  out of Tamil Nadu

While the concern of the NITI  Aayog  member about inadequate production of copper in the country is appropriate , what is the point in launching the PLI scheme for copper production  when a large capacity copper unit has been forced to remain closed in Tamil Nadu ?

Considering the fact that Sterlite  Copper was operating well and was also exporting copper successfully around the world , it is necessary that this valuable project should not be allowed to go waste.

Under the circumstances, considering the ground reality that  there is a motivated hate campaign against Sterlite Copper unit   by some activists and the state government is not in favour of the project for whatever reasons, the Government of India should encourage the Vedanta Group to shift the Sterlite Copper unit out of Tamil Nadu.

While shifting this large copper plant   from Tuticorin to another location would be an expensive affair, it would certainly be much less expensive   and much less time consuming. than setting up a new copper smelter project elsewhere.

Tamil Nadu’s loss will be a  gain for some other state and certainly it would be a gain for the country as a whole.