7/28/2019 BHM (Black Hawk Mining) Fraud Warnings Karnataka Lost Rs 1 Lakh Cr From 2006-2010

1/4

http://www.thehindu.com/news/national/karnataka/mining-scam-keeps-getting-bigger/article4820758.ece?homepage=true

The epic proportions of the illegal mining scam that was

uncovered by the Karnataka Lokayukta in its 2011 report

may actually have been just one act of a much larger, more

complex and multi-layered drama.

http://www.thehindu.com/news/national/karnataka/mining-scam-keeps-getting-bigger/article4820758.ece?homepage=truehttp://www.thehindu.com/news/national/karnataka/mining-scam-keeps-getting-bigger/article4820758.ece?homepage=truehttp://www.thehindu.com/news/national/karnataka/mining-scam-keeps-getting-bigger/article4820758.ece?homepage=truehttp://www.thehindu.com/news/national/karnataka/mining-scam-keeps-getting-bigger/article4820758.ece?homepage=truehttp://www.thehindu.com/news/national/karnataka/mining-scam-keeps-getting-bigger/article4820758.ece?homepage=truehttp://www.thehindu.com/news/national/karnataka/mining-scam-keeps-getting-bigger/article4820758.ece?homepage=truehttp://www.thehindu.com/news/national/karnataka/mining-scam-keeps-getting-bigger/article4820758.ece?homepage=truehttp://www.thehindu.com/news/national/karnataka/mining-scam-keeps-getting-bigger/article4820758.ece?homepage=truehttp://www.thehindu.com/news/national/karnataka/mining-scam-keeps-getting-bigger/article4820758.ece?homepage=truehttp://www.thehindu.com/news/national/karnataka/mining-scam-keeps-getting-bigger/article4820758.ece?homepage=truehttp://www.thehindu.com/news/national/karnataka/mining-scam-keeps-getting-bigger/article4820758.ece?homepage=true

7/28/2019 BHM (Black Hawk Mining) Fraud Warnings Karnataka Lost Rs 1 Lakh Cr From 2006-2010

2/4

There is now new evidence to suggest that the

Lokayuktas final report on illegal mining a political

game-changer that sent the powerful to jail and

catalysed a regime change in the state is just onepart of the mining story. A six-month-long

investigation by The Hindu, with help from

whistleblowers in the Railways, the Karnataka

Commercial Taxes Department and the CBI, points

to losses to the State exchequer between January

2006 and December 2010 that are, at the very least,Rs. 1 lakh crore or eight times the estimated figure

given in the Lokayukta report. The investigation also

shows that the State lost Rs. 2,000 crore in

commercial taxes. The new information suggests

that the dominant narrative on illegal mining, namely,

that illegal ore was mainly exported to China to feed

an infrastructure boom triggered by the BeijingOlympics, is actually a very partial telling of the

mining scam story. The new data with The Hindu

furthers the depth and reach of the mining scam, a

part of which was so exhaustively covered in the

Lokayukta report.

#miningstory:ht tp: / /promot ion.b lackhawk-mining.com/

http://promotion.blackhawk-mining.com/http://promotion.blackhawk-mining.com/http://promotion.blackhawk-mining.com/http://promotion.blackhawk-mining.com/http://promotion.blackhawk-mining.com/

7/28/2019 BHM (Black Hawk Mining) Fraud Warnings Karnataka Lost Rs 1 Lakh Cr From 2006-2010

3/4

Some our central findings are

as follows:

The Lokayukta report says that 12.57 crore tonnes of iron ore was

exported overseas from Karnataka between 2006 and 2010. However,

documents with The Hindu reveal that nearly 35 crore tonnes of ore was

transported out of Bellary in the same period. If one were to deduct the

12.57 crore tonnes exported (as per Lokayukta report), the remaining the

22.43 crore tonnes was sold in the domestic market. The Lokayukta report

estimates the losses to the exchequer at Rs. 12,228 crore. The

organisations calculation was based on the fact that the government had

given permits for extraction for only 9.58 crores tonnes of ore. Subtracted

from the 12.57 crore tonnes exported, it meant that 2.98 crore tonnes of

ore was illegally mined and exported. The Lokayukta estimated the price

of ore exported at an average of Rs. 4,103 per tonne. What explains the

divergence between the findings of the Lokayukta and those of The

Hindu? The Lokayukta has relied on Customs Department data on ore

shipments exported from 10 ports in Karnataka, Goa, Tamil Nadu and

Andhra Pradesh between 2006 and 2010, to calculate the quantum of ore

that left the country.

7/28/2019 BHM (Black Hawk Mining) Fraud Warnings Karnataka Lost Rs 1 Lakh Cr From 2006-2010

4/4

By contrast, The Hindu has looked at the total quantity of ore transported out of

Bellary by road and rail. Railway documents show that 20 crore tonnes of iron ore

was transported out of Bellary from six railway stations and 14 railway sidings

between 2006 and 2010. Of this, nearly 19 crore tonnes of ore was marked for

export. From data sources in the CBI and Commercial Taxes Department, we know

that lorries carried at least 14 crore tonnes of ore out of Bellary by road in the nine

months between September 2009 and June 2010. This was when the Bellary[Reddy] brothers had rebelled against B.S. Yeddyurappas government. The rebellion

was a smokescreen to intensify illegal mining. At least 20,000 trucks were leaving

Bellary each day in that period, a CBI official told The Hindu. Leaving out these nine

months, on each day between 2006 and 2010 an average of 1,000 lorries left Bellary,

with an average load of 32 tonnes of ore per truck. This adds nearly another 4 crore

tonnes to the overall tally.