mining conference presentation bs nagaraj
TRANSCRIPT
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7/29/2019 Mining Conference Presentation BS Nagaraj
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2006 Hill & Associates Mitigating the Risks of Globalisation
Sustainable Mining and Local Communities:
Maximizing Stakeholder Benefits through Effective Social Impact
Management
Assocham conference on Indian Mining and Metal Sector: Turning Risks
into Opportunities
B.S.Nagaraj
Hill & Associates
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India: A Global Mining Destination in the Making
Large Resources base
Estimated 82 billion tons of reserves ofvarious metals yet to be tapped
Fourth in iron ore production and sixthin reserves; fifth in bauxite production;
third in coal production
Policy changes, coinciding with risingglobal demand, beginning to showresults
FDI flowing; Posco & Mittal sign MoUsmany others in the pipeline; Projectedinvestments at over USD 50 billion over10 years
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Outlook rosy but concerns remain
Mining sectors contribution to GDP at a low of around 2.5%;sectors contribution to Australian GDP in 2004-05 8%
Indian mining pulled back growth of Indian economy
Policy frameworks need alignment with those in developed mining
economies
Lack of communitys confidence in resources-based industrialization
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Community is key to success
Investment Climate: Influencers
Security
COMMUNITY
Politics
Policy
Investment Climate
Infrastructure
Law
Supply Chain
Community becoming the biggest hurdle for growth
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Absorption of Investments
Rising Community Opposition aNightmareOrissaJharkhandAndhra Pradesh
Projects have faced
protests/disruptions
NGOs, interest groups, political partiescatalysts
Looming Threat of Cost & Time Overruns
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Community Opposition: Why? 1
Most mineral-rich clusters inhabited by population which relies
on land for livelihood
Land being central to their sustenance, displacement is a bigissue
Rising awareness of rights as a result of mobilization by NGOs,interest groups
R&R policy landscape inadequate in addressing concerns
Constraints on making land-for-land mandatory
Community ill-equipped to take advantage of cashcompensation
Clamor for jobs but opportunities limited; skillsets paucity
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Community Opposition: Why? 2
Industrys commitment towards community & sustainablemining largely missing
Reliance on quick-fix/firefighting solutions
Inability/Unwillingness to recognize community as the centralstakeholder
Over-dependence on government to show the way
Unwillingness to go beyond compliance
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Community: Core R&R Demands
Land for land
Employment
Consultation
R&R customization
Skill upgradation Environment Protection
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Community Management: Why the Failure? 1
Kneejerk responses & patchwork
strategies by government, industry
R&R policies do not anticipate long-term adversarial trends
R&R policies not backed up by otherenablers
Lack of transparency about projectinformation
No effort to set realistic communityexpectations
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Community Management: Why the Failure? 2
PROJECT
Concerns
ResponseSocio-economic
context
Social impactmitigation
Projects suffer risk of failure if they fail tounderstand the community
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Better Management of Conflict: How?
Hill & Associates Sustainable Mining Framework
Comprehensive Social Impact Assessment (SIA) Community Development Plan Stakeholder Consultative Forum
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Why Social Impact Assessment?
Definition
Process of assessing/estimating in advance social consequences, bothpositive and negative, of project developments/actions
Make SIA mandatory on lines of EIA; tie it to project approvals
Components Assessment Mitigation
Consolidation of Key Learnings Monitoring Audit
Benefits Estimates social cost
Increases stakeholder benefits Minimizes community resistance Reduces project disruption & increase project success Reduces project cost in the long run
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Assessment of Mitigation Measures
Communication Strategy
Measurement Tools
Prediction Techniques
Baseline Data Collection
Implementation Strategy
Socio-economic context
Project Nature/Size
Law & Policy
SIA The Stages
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Stakeholder Consultative Forum
Stakeholder Consultative Forums (project-specific for industry &mineral area-wise for government)
Benefits
Better understanding of stakeholder concernsMore transparency and information sharing
Lower mistrust between industry-government & community
Information sharing & dialogue critical but platform missing
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Community Development Plan
Envisages
Assessment of socio-economic needs of community Designing of need-based development plans for
expanding livelihood options
Benefits Increases goodwill for project proponent Enhances visibility of corporate social performance Contributes to goal of sustainable mining
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To Conclude
Social Risk posing biggest challenge to industrialization
Social Risk more difficult to mitigate, and combined with
other factors the risk landscape becomes more complex
Incorporating best practices in community management key
to minimizing conflict and achieving success
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Thank You
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