The iron ore mining agreement between NMDC-CMDC and Adani Enterprises (AEL), a joint venture of the National Mineral Development Corporation (NMDC) and the Chhattisgarh Mineral Development Corporation (CMDC), has been terminated. The contract was terminated for the reasons listed by NMDC-CMDC in its letter to Adani Enterprises, including “monopoly in operations, shifting responsibilities, and providing mischievous information.”
The contract, which was signed on December 6, 2018, pertains to the allocation of south Chhattisgarh’s Bailadila iron ore Deposit-13 at Kirandul in Dantewada to Adani Enterprises.
The CEO of NMDC-CMDC wrote to Adani Enterprises on August 28, 2023, stating that the company had failed to take crucial actions toward reaching the agreed-upon goals and objectives.
Adani Enterprises’ Fault?
There was a public uproar when Adani Enterprises allegedly caused the illegal felling of trees as a result of operations starting at the Bailadila iron ore mine. On June 19, indigenous tribes violently protested, alleging it was an assault on their religion and their divinity, Nandraj Dev. They claimed that Nandraj Dev lived in the Bailadila hills, where the iron ore mine Deposit-13 was situated.
The local administration refrained from interfering to prevent further escalation of social anger.
A responsible authority at NMDC-CMDC Ltd disparaged AEL and gave it a show-cause notice for termination after considering the agreement’s different terms and circumstances and Adani Enterprises’ progress. Adani Enterprises continued to be “silent on its responsibilities,” according to the authority, which deemed the company’s comments to be “unsatisfactory” and lacking in their capacity to inspire confidence.
Adani Enterprises allegedly attempted to transfer responsibility to NMDC-CMDC in response to the show-cause notice, which the authority rejected as a “lame proposition not worthy of acceptance.”
The Chief Executive Officer of NMDC-CMDC indicated in the termination order that it is “mischievous” to suggest that the NCL is to blame for the failure. Nothing is gained by continuing with a non-starter. The December 6, 2018, iron ore mining service agreement is hereby canceled.
Another setback for
Adani Group
The beleaguered Adani Group has already suffered a string of setbacks as a result of increased scrutiny for alleged governance failures from foreign investors like Hindenburg Research and The Organized Crime and Corruption Reporting Project (OCCRP), as well as India’s opposition parties.
The Raipur and Delhi offices of the Adani Group did not reply to our request for comment regarding this cancellation.