Mining Giant Vedanta Bought Electoral Bonds Worth Rs 400.65 Crore

Bengaluru: Vedanta Limited – which has been regularly pulled up for environmental violations across several of its mining and oil and gas projects in India – bought electoral bonds worth Rs 400.65 crore, as per the data released by the State of Bank of India (SBI) on March 14. 

While some news reports specified this number at 375.65 crore, this figure refers to electoral bonds bought only by “Vedanta Limited”. In entries listed in the data provided by the SBI, “Vedanta Ltd” also bought bonds worth Rs 25 crore in January 2022. 

The Wire took a peek into the timelines of some of these payments, the deals that the company landed during this time, and some of the environmental controversies that Vedanta has been embroiled in.

Black gold? Locals don’t agree

As per data provided by the SBI (from 2019 to 2024), Vedanta Limited alone donated Rs 375.65 crore in electoral bonds to unknown political parties. Vedanta Limited bought its first set of bonds worth Rs. 39.65 crore on April 16, 2019. 

On April 25, 2019, PTI reported that Vedanta received environmental clearance from the Ministry of Environment, Forest and Climate Change (MoEFCC) for the expansion of its oil and gas operations in Rajasthan, a project it planned to invest Rs. 12,000 crores into. 

Vedanta, under its vertical Cairn Oil and Gas, had proposed to expand its existing onshore oil and gas production – from 3,00,000 barrels oil per day or BOPD, to 4,00,000 BOPD, and from 165 million standard cubic feet per day or MMSCFD to 750 MMSCFD – from the “RJ-ON-90/1” block located in Barmer district in Rajasthan.  

As per Vedanta’s website, the Rajasthan block RJ-ON-90/1 is spread over 3,111 square kilometers in Barmer district. The block has “contributed USD 23.7 billion to the nation and the state exchequer”, as on March 31, 2023, and cumulative production from the Rajasthan block has crossed 700 MMBBLS or one million barrels of oil. 

“13 dry wells were drilled in Rajasthan block before Cairn struck ‘black gold’ in the 14th well. The organisation has come a long way since, with numerous discoveries in the Rajasthan block, bringing a number of fields to production, and gearing towards the next phase of growth,” the website reads.

But black gold has been turning water sources black too, making water unsuitable for human and animal consumption, and even agriculture, NewsClick reported farmers in the locality as saying. Though district officials ordered Cairn to supply drinking water to some villages in the area, locals alleged that this was not done. Cairn/ Vedanta refuted these allegations.

After it bought its first electoral bonds in April 2019, Vedanta continued its buying spree: it bought bonds worth Rs 10 crore on May 10, 2019, and bonds worth Rs 3 crore on October 9, 2019.

Of fines, clean chits and the pandemic

Then came the Covid-19 pandemic. During the lockdown in August 2020, a public hearing was scheduled to be held regarding the environmental clearance for the oil and gas project in Barmer, but farmers – under the Kisan Sangharsh Samiti – wrote to local district officials, the then Chief Minister Ashok Gehlot and the Prime Minister’s Office that it be conducted later. A report released by the Organized Crime and Corruption Reporting Project (OCCRP) in August 2023 found that during the pandemic, Vedanta lobbied the Indian government to weaken certain environmental regulations, and relax rules for industries to produce up to 50% more without obtaining environmental clearances. And the government made these changes, without any public consultation. 

“Vedanta’s oil business, Cairn India, also successfully lobbied to have public hearings scrapped for exploratory drilling in oil blocks it won in government auctions,” the report noted.

Documents and government sources suggest that “Vedanta’s lobbying was key” to the weakening of environmental regulations during the pandemic, the report found. 

Vedanta continued to buy electoral bonds. On April 8, 2021, the company bought electoral bonds worth Rs 25 crore. And after almost nine months, on January 10, 2022, Vedanta Limited bought electoral bonds worth Rs 73 crore.  

A month before, in December 2021, NewsClick reported that Vedanta did not divulge information about environmental litigation pending in the NGT – pertaining to damages to agricultural land and water due to the unsafe disposal of fly ash, a polluting byproduct from Vedanta’s aluminum smelter’s captive power plant in Jharsuguda in Odisha – to the MoEFCC in its plans to expand the plant. The news report also noted that according to the company, the case was closed. 

Meanwhile, in May 2022, the NGT imposed a fine of Rs 25 crore on Vedanta Limited for violating environmental norms by expanding its alumina refinery and captive power plant at Lanjigarh in Odisha’s Kalahandi district.

But in June 2022 however, India’s apex green court, the National Green Tribunal (NGT), gave a clean chit to the Oil and Natural Gas Corporation (ONGC) and Cairn Oil and Gas after locals moved the NGT about the pollution in Barmer and challenged the companies’ environmental clearance granted by the MoEFCC. 

The court “reasoned that the oil block was important to the country’s energy security as it plays a pivotal role by contributing approximately 25% of the total domestic crude oil requirement”, BarAndBench reported. 

Black gold continues to shine 

In July 2022, Vedanta bought electoral bonds worth Rs 45 crore, followed by a whooping 110-crore investment in electoral bonds in November 2022. A month earlier, in October 2022, Cairn Oil and Gas had received an extension for its Rajasthan block in Barmer till May 2030, from the Ministry of Petroleum & Natural Gas. 

Less than a year ago, in July 2023, locals protested in a sit-in dharna in Barmer district against the pollution of precious groundwater in the area by Cairn Oil and Gas. The same month, Vedanta bought electoral bonds worth Rs 40 crore. Not much came of the dharna in Barmer: it disappeared from the news cycle. Vedanta continues to produce “black gold”. 

Vedanta continued to buy electoral bonds in late 2023. On October 6, it bought bonds worth Rs 25 crore. And finally, bonds worth Rs 5 crore on November 9, 2023.

Just last month, the Goa Cabinet gave its approval to signing the Mining Development and Production Agreement (MPDA) with Vedanta Limited for its Bicholim Mineral Block in north Goa. 

Table showing amounts spent on electoral bonds by Vedanta Limited between 2019 and 2024. Source: SBI 

But…there’s more 

A separate entry named “Vedanta Ltd” – in essence the same as Vedanta Limited – donated Rs. 25 crores in electoral bonds in January 2022 alone.

So put together (under the assumption that Vedanta Limited and Vedanta Ltd are the same entity), the company has bought electoral bonds worth Rs. 400.65 crores between April 2019 and January 2024. 

This also makes Vedanta the fourth largest buyer of electoral bonds.

Incidentally, the Delhi High Court had indicted both the Bharatiya Janata Party – the biggest beneficiary of electoral bonds, at INR 6,060.5 crore – and the Congress (the third biggest beneficiary, at 1421.9 crore) in 2014 for illegally receiving foreign funds from two subsidiaries of Vedanta Resources, a UK-based company. In 2016, however, the BJP retrospectively amended the Foreign Contribution Regulation Act (FCRA, which regulates the inflow of foreign funds to Indian entities) by changing the definition of what constitutes a “foreign” company. The amendment made funds received after 2010 valid, bailing out both the BJP and the Congress on the matter.