Moosaboni, one of the oldest copper mines in the country, is a ghost of its former self. The industrial meltdown in Jharkhand has taken its toll on this mine nestling in the lap of the Chhotanagpur hills. The copper deposit at Moosaboni was first prospected by the British in 1927. The high-yield concentrate opened the industrial floodgates, drawing entrepreneurs by the dozen. It also led the way to an Aladdin’s cave as prospectors prised open several mines in the adjoining areas — forming what came to be known as the “Singhbhum copper plate”. Moosaboni (with its outlets at Badiya, Banalopa and Patragora), Kendadih, Raka and Surda — spanning roughly 50 kilometres — changed the landscape of the Chhotanagpur hills, straddling the Subarnarekha and its network of tributaries. Townships mushroomed on the lush slopes of the undulating hills bordering the river and mining began in right earnest. A mammoth smelter at Moubhandar near Ghatshila sifted the rust-coloured dust mined from the pits for the “poor man’s gold.’’
The open-cast mines yielded premium-grade copper that added grist to the roaring “hearths” at the neighbouring Tata Iron and Steel Company, the Heavy Engineering Corporation Limited and the units of the Steel Authority of India Limited, scattered over the Jharkhand-Orissa plains. Voluminous pipelines from Moubhandar to Jadugora, barely 30 km away, transported the “tailings” or copper ends to the next-door neighbour, the Uranium Corporation of India Limited for extraction of uranium isotopes.
The copper ran its course for 70 years, nourishing the sprawling Hindustan Copper Limited plant at Moubhandar. The Indian Copper Complex became the pivot on which the economy boomed at the micro-level. A subaltern axis of local contractors, traders, babus and the mafia reaped this harvest.
The fact that Ghatshila was the headquarters of the Dhalbhum sub-division accelerated the process of growth. An allied economy struck roots, providing hundreds of local tribals, Bengali, Bihari and Oriya migrants with alternative sources of sustenance. The green of the mountains blended perfectly with the laid back corporate culture of the protectionist era.
HCL splurged on the social sector, including key infrastructure projects like the Kumaramangalam bridge over the Subarnarekha (replacing an old causeway) and the Ghatshila College. The upmarket company clubs, luxury guest houses, swimming pools and tennis courts vied for honours with the neighbouring Tata facilities at Jamshedpur.
But the Nineties marked a watershed. The odds started outweighing the aces at the turn of the decade when the government flung open its doors to liberalization. Free trade re-scripted the copper story with a rather grim finale. Removal of protectionism, radical tax restructuring and a drastic slash in subsidies to ease imports and allow other players in the field took the wind out of Hindustan Copper’s sails.
The giant gasped for breath as the Birlas stormed the scene with cheaper concentrate imported from abroad, and Anil Agarwal of Starlite weaned away the best brains from Hindustan Copper. The Centre tucked away the silver spoon and asked it to generate its own resources. With no funds forthcoming, an orphaned and over-staffed HCL found it difficult to compete in the open market. High mining costs and spiralling overhead expenditure gnawed at its underbelly and the edifice crumbled. “We tried everything but it was difficult,’’ rues a senior HCL official.
Moosaboni was the first to feel the “downsizing” heat and closed shop in 1998. The mine had emptied itself and operations became unviable. The ore quality degenerated and the company found it difficult to keep the pits running. The sprawling infrastructure gathered rust and an exodus stripped the township bare. Those who stayed back struggled to sustain on the voluntary retirement benefits.
The Moosaboni virus spilled over to Kendadih which fell like nine pins in 1999, followed by Rakha. For two years, it was attempted to keep Rakha operational, but the costs were forbidding. The Rakha mines breathed their last on June 30 this year. The 1,100-odd workers were bade a golden adieu and asked to retain their official quarters for two years. The mood at Surda, the lone functional mine, is sombre. The mazdoor union expects the axe any time.
Shrinking mining activity has crippled the local economy. Small-time contractors have taken to “scrap business’’ to recoup their losses. The Bengali and Oriya traders are struggling to make ends meet. “My shop used to transact business of over Rs 8,000 a week, but now it barely manages to rake in Rs 2,000 per month,’’ laments Swapan Nanda, a Rakha-based trader. A number of private schools, including the Central Academy at Surda, are thinking of closing down because of the high dropout rate.
Officials attribute the ICC’s plight to three factors — the glut in the domestic market flooded with cheap imports, rampant copper smuggling through the porous Indo-Nepal border in Bihar and Uttar Pradesh, and the government’s disinvestment policy. Since 1991, Birla Copper and Starlite began feeding the copper-based industries with cheaper concentrate forcing the HCL to do the same at ICC. It curtailed local operations and began importing ore from its Malajkhand mines in Madhya Pradesh. Depleting reserves provided the company with an excuse to shift focus.
A well-organized international copper smuggling racket added to ICC’s woes. The local ancillary units at Adityapur industrial complex in West Singhbhum sought recourse to smuggled copper from Nepal, sold at almost half the market price, since 1995. The smugglers took advantage of the lopsided Indo-Nepal trade pact and ferried back imported copper, which passed through India en route to Nepal (and over which India had no jurisdiction vide clauses in the the treaty) through the porous border. Though the HCL has represented its case in Delhi a number of times, India has yet to take it up at the bilateral level with Kathmandu.
Officials feel that there could have been an upswing in ICC fortunes had the Bihar government renewed the Chapri-Siddheshwar mine lease in 1989. In 1975, the HCL commissioned an Australian agency to carry out a feasibility study of the Chapri-Siddeshwar seam after the GSI discovered fresh copper deposit in the area. The survey, conducted at a cost of Rs 2 crore, revealed that the valley tucked in between Rakha, Kendadih and Surda was a virtual treasure trove. But the HCL required Rs 40 crore to open a channel and Rs 100 crore to get the mine operational. The Centre refused to cough up the amount. The lease expired in 1989 and the former Bihar chief minister, Laloo Prasad Yadav, decided to play dirty.
The Centre has drawn up a detailed disinvestment plan involving a number of key HCL units, including the ones at Khetri and Taloja. Officials fear that a similar fate awaits the ICC, which may end up the Balco way.
There is, however, still some hope. Streamlining manpower and cost-cutting drives are on a war-footing. The recipe for remedy is simple. If the workforce is reduced to 10,000 and the government comes forward with a bail-out package and disinvestment plans are kept on hold, the ICC can still become a viable unit for open competition. The ICC is even ready to hive off its infrastructure to private parties and develop the area for “eco-tourism’’. Former employees may even be asked to buy the quarters at reasonable rates on the lines of the SAIL experiment.
The visions, though noble, are far-fetched, going by the fact that the Jharkhand government has yet to come up with a draft industrial policy. HCL’s story encapsulates the changing face of Jharkhand’s economy. Almost all the public sector units are on the verge of closure or face the chopping block of disinvestment. Be it HEC, Meckon or SAIL, the story is the same everywhere.
The house of the beleaguered Jharkhand chief minister, Babulal Marandi, is still in a state of flux. Sick public sector units figure low on his list of immediate priorities.
IRL Price at posting:
0.5¢ Sentiment: LT Buy Disclosure: Held
