Corporates cheer as oil minister Moily takes charge of green clearances

NEW DELHI - Veerappa Moily has two seemingly incompatible jobs.

As oil minister, he has overseen India's petroleum and natural gas needs. But now he also runs the environment ministry, where he has issued permits for 100 stalled projects in a month-long spree that has delighted industry but shocked green activists.

Since taking the additional environment portfolio on December 24, he has given his go-ahead to projects worth some $40 billion, including Posco's (005490.KS: Quote, Profile, Research) $12.6 billion steel plant and forest clearances for India's first major hydropower projects in the wilderness state of Arunachal Pradesh, near a contested border with China.

Moily's haste is part of a last-minute push by India's outgoing government to revive investment in the economy after two years of growth at decade lows. The general election is due by May.

But the friction the clearances have generated go to the heart of a long-standing dilemma: how to develop quickly in a country still plagued by poverty while minimising damage to the environment.

In an interview in his oil ministry office, under an image of a drilling rig, Moily said his approval push was "necessary".

"On the planet there is space available for the wildlife, for the forest and also for the human being," he said, vowing to take decisions by February 15 on a backlog of projects worth about $100 billion.

Moily is no stranger to controversy. Last year he was widely ridiculed for proposing to close petrol pumps at night to help curb oil imports as the rupee slumped to record lows.

Environmental campaigners are outraged at Moily's twin jobs, accusing him of steamrolling opposition to some projects from tribal populations and ignoring concerns about biodiversity. One group dubbed his appointment "shocking and bizarre."

"You have given speedy clearances by ignoring all the stakeholders except the corporates," Greenpeace said in an open letter to Moily. Citing a "clear conflict of interest" between his two portfolios, it demanded his resignation.

Moily denies he is unduly favouring industry, saying he will not bypass environmental rules to clear a backlog of decisions. He cited his rejection of Vedanta Resources Ltd's (VED.L: Quote, Profile, Research) plea to mine bauxite in the Niyamgiri hills of Odisha state after local residents opposed it.

"It is not a question of favour. If you are not taking a decision, ultimately what happens ... you are working against the interest of the nation," he said.

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