From reforming discoms to recruiting skilled energy managers, the list of reforms is formidable.

On the first day of the Glasgow climate conference – COP26 – the biggest announcement came from India. Ending speculations on whether India ‘will’ or ‘can’ make a net-zero pledge, Prime Minister Narendra Modi announced that the country will reach net-zero emissions by 2070. He also announced four major nearer-term targets exhibiting India’s will and ambition on climate action.

The targets, all of which are to be met by 2030, include an installed renewable energy capacity of 500 GW (up from 450 GW target); meeting 50% of the electricity requirement through renewable sources; reducing total projected cumulative carbon emissions by 1 billion tonnes between 2020 and 2030; and reducing the carbon intensity of GDP by 45% from 2005 levels (up from the 33-35% target).

So how ambitious are these new targets?
India’s renewable energy targets mean that coal power will peak before 2030, when about 70% of India’s electricity installations will be renewable-based, battery and smart grid will dominate the market. This would be one of the most rapid decarbonisations of electricity sector anywhere in the world.
India’s net-zero target is equally ambitious, but few more details are required to understand what it means. There is confusion on whether the target is for all greenhouse gases (GHGs) or only for carbon dioxide (CO ₂). If it is for all GHGs, then India’s target is compliant with 1.5°C warming. If it is only for CO ₂, it is 2.0°C compliant. However, even if only for CO ₂, it is still a strong signal to decarbonise the economy. As zero-carbon technologies become more accessible, India will update this target to attract massive global investments.

What domestic reforms do they demand?
In nutshell, these announcements have put India in a leadership role on climate mitigation action. The question now is, what are some of the major steps that must be taken domestically to steer the course of action in the coming years? There are three ‘make or break’ factors for realising India’s ambitious targets.

• Firstly, if 500 GW of power-generation capacity must be achieved, India must create an enabling environment for attracting global investments. Reforming the distribution companies (discoms) is most important to create that environment.
• Secondly, for meeting 50% of electricity supply through renewables, India’s grid infrastructure will have to be strengthened and battery storage capacity will have to be massively increased. Investing in smart grid and battery infrastructure is crucial for this.
• Third, a huge skilled workforce will be required to run the new electricity infrastructure. This means investments must start in reskilling of existing and skilling of new workforce to meet the future requirements.
• Finally, all of these changes in the energy and industrial systems must be paralleled by a plan of just transition, to ensure that we do not carry forward the legacy of unequal development challenges of the coal era, into the new era of renewable energy and a greener economy.

In fact, while energy transition has been a hot topic on the policy and business front, just transition has not got the due attention. However, as coal power will peak before 2030, it is time for India to start policy deliberations, develop plans for, and consider investing in it. And this is why it is crucial.

Could renewables mean unequal development?
India’s energy geography will change because of massive investments in renewables. Today’s coal-producing states will not be renewable superpowers. The renewable energy will be generated in western and southern states.
Therefore, as the share of non-fossil fuel energy grows, the coal regions can spiral into a poverty trap, which many of the districts here are already saddled with. There can also be huge social instability triggered by job losses and uncertainty of income opportunities. An estimated 20 million plus workers will be impacted countrywide by the transition. In fact, the disproportionately high number of informal workers in our key economic sectors such as coal mining, transportation, steel, cement etc adds to the challenge. But all this can be avoided through a well-planned and well-managed just transition over the next decades.
Planning a ‘just’ energy transition will be a smart move by the government to further a development agenda that benefits all. We have the next 30 years to complete the transition, but the process must start now.

The writer is Director, India Just Transition Centre, International Forum for Environment, Sustainability & Technology (iFOREST)

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The article discusses why it is an imperative for India to begin deliberation on a just transition from coal in light of some of the compelling factors. It then evaluates what a just transition in India might entail building on an onground study of a coal district in Jharkhand, one of India’s top coal mining states. And fi nally, it outlines the planning and policy considerations that will be necessary to support a
just transition.

Over the past two decades, a growing body of research on climate change has made it clear that a shift away from the fossil fuel economy is inevitable. This will entail a system transition in electricity generation, based on renewable energy sources and simultaneous phasing out of coal-based power by 2050 (IPCC 2018).

However, there are socio-economic consequences of such a transition that cannot be overlooked. A fundamental concern is about the fate of fossil fuel industry workers and local communities who are dependent on it. Just transition as a policy and planning concept tries to address this. Originally advocated by labour unions (Galgóczi 2018), and later merging with the broader debate on environmental justice, the concept underscores the need of ensuring social justice in the shift towards a low carbon, or a carbon neutral future (Morena et al 2019).

The basic idea of a just transition is to secure a sustainable and decent livelihood for the people who are dependent on the fossil fuel industry through proper planning and investments. Simultaneously, there must be efforts to eradicate poverty in those regions, and to build thriving and resilient communities (ITUC 2017). It insists on the idea that a healthy economy and a clean environment can and should coexist (Just Transition Alliance 2018).

The socio-economic aspect of the energy transition is now an essential component of the climate change discourse. In 2015, just transition was included in the preamble of the historic Paris Agreement (2015) as, taking into account the imperatives of a just transition of the workforce and the creation of decent work and quality jobs in accordance with nationally defined development priorities.

Since then, it has become an important policy component of climate change mitigation action. Countries of the global North are coming up with just transition policies and plans. In most countries of the global South, including India, the discussion on a just transition is either in its infancy or has not been initiated (Pai et al 2020).

India and Just Transition
In India, a policy discourse on a just transition has not been initiated yet because of our high dependence on coal for energy security and industrial growth. However, it is time for such a discussion to begin considering five compelling factors.

First, in India, coal is losing its edge progressively. While overall coal mining is still profi table, with the country’s largest coal producer Coal India Limited (CIL) recording profi ts, about two-thirds of the CIL-operated coal mines are unprofi table and are closing down (Bhushan et al 2020). These are primarily low yielding underground mines, which are a disproportionately high number compared to their cumulative production capacity. As per the latest information of the company, of the 352 mines CIL and its subsidiaries currently operate nearly 45% are underground mines (158 mines). However, they account for only about 5% of the company’s raw coal production (CIL 2020). The employee liability of these mines is very signifi cant, as they employ about 40%–45% of CIL’s total workforce. As per internal inputs, the loss from continuing with these mines is about 16,000 crore per year, about the same as the company’s annual profi t in 2018–19. The alarming issue is that these unprofi table mines are closing down in an unplanned manner (Bhushan et al 2020). Besides underground mines, old opencast mines are also proving to be unprofi table and are either closed or temporarily discontinued. For example, in Jharkhand, one of India’s top coal producing states, more than 50% of the coal mines are currently closed, including both opencast and underground mines (Department of Mines and Geology 2020).

Second, coal is facing a major challenge due to the growing cost competitiveness and reliability of power from renewable energy sources. The installed cost and tariffs of utility-scale solar photovoltaic plants in India have fallen by 85% since 2010 (Henbest 2020). In 2019, it stayed around 2.50–3.00/kWh, depending on the location of the offtake risk (Saran et al 2019). This is 20% to 30% cheaper than the cost of power from existing coal plants. Solar power prices are expected to fall further in the coming years to around 2.00/kWh by 2030, while the cheapest pithead coal power price is likely to rise to `4.85/kWh by that time (CPI and TERI 2019).

The third reason is the pollution and environmental burden of coal-based power and coal mining. Coal-based power plants are the largest source of industrial pollution in India. Of the entire industrial sector, they alone account for 60% of suspended particulate matter (SPM) emissions, 50% of sulphur dioxide (SO2), 30% of nitrogen oxides (NOx), and 80% of mercury (Hg) emissions (Bhushan et al 2015). Considering this, the environmental standards of coal-based power have been made progressively stringent. In 2015, the Ministry of Forest, Environment and Climate Change (MoEFCC) imposed new standards on coal power plants to limit their emissions of SO2, NOx, PM and Hg. The estimated capital expenditure required to meet these standards is about 86,135 crore. This will add between 0.32/kWh and `0.72/kWh to the existing power tariffs (or around 9% to 21% to their average generation tariff) depending on the size of the units and other factors (Garg et al 2019). For coal mining, MoEFCC in 2010 had identifi ed most of the top coal mining areas as critically polluted areas. These include Hazaribagh and Dhanbad in Jharkhand, Singrauli in Madhya Pradesh, Korba in Chhattisgarh, and Angul (Talcher coal-fields) in Odisha, among others (Bhushan and Banerjee 2015). In addition, coal mining remains one of the major factors for forest-land diversion. On an average, an estimate of the last 40 years shows that 20%–25% of total forest land diversion is due to mining, and about half of that is for coal (Bhushan etal 2020).

Fourth, we need to plan a transition away from coal to reverse the legacy problem of resource curse in the coal regions. Most of India’s top coal mining districts suffer from this, with the local people facing displacement and deprivation due to resource extraction. In many of India’s top coal mining districts there is a high proportion of deprivation and poverty. For example, in districts such as Singrauli, Sidhi, Chatra, Godda, Surguja, Korba, and Sonbhadra, about 40% or more of the people are multidimensionally poor, exhibiting very poor status of health, education, and living standards (as per Oxford Poverty and Human Development Initiative multidimensional poverty index calculator). This is nearly twice the all-India average of 27.9% (Oxford Poverty and Human Development Initiative 2020).

Finally, is the urgency of climate change action. For India, this becomes necessary not only considering our environmental obligations, but also given the economic and social costs of the climate crisis. India is the fi fth most vulnerable country to climate change impacts, as per the Global Climate Change Risk Index 2020 (Eckstein 2019). Under business-as-usual scenario, climate change will increase the stress on the country’s natural ecosystems, agricultural output, and freshwater resources, while also causing escalating damage to infrastructure. These will have severe consequences for the country’s food, water and energy security, public health, and for sustaining the country’s economic growth (Bhushan et al 2020). In 2018, India’s economic losses due to climate change were the second-highest in the world, with the estimated loss at 2.7 lakh crore, which is equivalent to about 0.36% of its gross domestic product (GDP) (Eckstein 2019). The Ministry of Finance (2020), has further estimated that the cumulative costs of climate change adaptation till 2030 will be 85.6 lakh crore, equivalent to nearly 58% of India’s GDP in 2019–20 at constant prices (National Statistical Offi ce 2020).

Global experiences of successful coal transitions show that if a transition is planned in a timely and deliberative manner, it will not be a tradeoff between

the environment and economy, and can lead to positive social and environmental outcomes (Bhushan et al 2020). In fact, just transition will be an appropriate policy move for the Government of India (GOI) to complement its vision of energy transition and to meet the Sustainable Development Goals (SDGs).

Evaluating a Just Transition
In countries of the global North, the experience on just transition has been primarily related to the formal workforce of the coal industry and associated socio-economic factors (Bhushan et al 2020). However, in India, the situation is different considering that most of our key economic sectors are based on an informal economy (Labour Bureau 2014). Global experiences also suggest that there is no one standardised approach for a just transition. The dependence on fossil fuel, and the nature of the transition will vary from country to country and from region to region within a country. Any approach to a just transition thus needs to be evaluated in a country-specific manner and planned in the context of respective fossil fuel/coal mining regions (Bhushan et al 2020).

Ramgarh district of Jharkhand constitutes a representative case to evaluate what just transition means for India. One of Jharkhand’s top coal mining districts, Ramgarh produces about 13 million tonnes of coal per year. However, production has been steadily declining over the past four years. Currently 50% of the total of 24 coal mines in the district are closed or have been temporarily discontinued due to various reasons, including unprofitability. 1 The remaining mines have a productive life of 10–25 years, and there are very few new ones in the pipeline ( Department of Mines and Geology 2020). Therefore, coal mining activities in the district will largely be phased out in the next decade or two. While coal still remains central to the district’s economy, Ramgarh is as an appropriate case to understand what a coal phase-out will look like, and what it will entail.

Study Approach
The Ramgarh study is based on a mixed approach of primary and secondary research. A primary survey was conducted of 406 households in the district, that were selected through a process of strati fi ed random sampling.2 Samples were chosen from three geographic strata: 0–3 kilometre (km), 3–10 km, and beyond 10 km, from the mine/mine cluster, to minimise the possibility of clustering and selection bias.3 Besides, 14 focus group discussions were conducted with various stakeholder groups in the three main coal mining blocks, namely Mandu, Patratu and Chitarpur, covering 138 participants. Personal interviews were also conducted with state government representatives, the district administration, public representatives, panchayati raj members, labour unions, coal industry officials, and civil society groups.
Secondary data was obtained for understanding the coal industry profi le in Jharkhand and Ramgarh, and for analysing the demographic distribution, economic status, social infrastructure, and key development parameters in Ramgarh. The data also helped to evaluate the political economy of coal mining in the region, and to identify the various stakeholder groups that will be affected, and are related to the just transition process.

Key Observations
The Ramgarh case study brings out four key observations that are important for understanding just transition in India.
First, the dependence on coal mining for income is signifi cantly high. Out of the total surveyed households, 27% (equivalent to 54,000 households in the district) depended directly on coal for an income. Nearly three-fourths of them (71%) were part of the informal coal economy, including coal gatherers and sellers, casual labourers, and other contractual workers (including businesses). Only 29% had formal employment with coal companies.

Majority of the people belonging to the informal economy also fall within the low-income group, with a monthly household income between 5,000 and 10,000. This group of people also lack labour protection or social safety.

Second, income dependence on coal is spatially concentrated. While more than 40% of the households within a radius of 3 km from the mines derived direct income from coal, this proportion sharply declined to less than 17% for households living beyond 3 km of a mine. In fact, beyond 10 km from coal mining areas, agriculture was observed to be the most signifi cant source of employment. The district’s overall worker distribution, as per government data, also indicated high agricultural dependence, particularly in the rural areas, which is as high as 75% of the total main workers.

Third, the distributional impact of coal mining in the region has been extremely limited, benefi ting only a few. The district remains extremely poor in terms of social infrastructure or access to basic amenities. For example, there is nearly a 50% defi cit in the required number of primary healthcare centres. Moreover, even the existing ones do not meet the necessary Indian public health standards in terms of medical staff, treatment facilities, etc. The same situation is with access to education. Only 16% of the schools offer secondary/higher secondary education, with average enrolment below 50%. With respect to people’s access to basic amenities, such as clean drinking water, only about 17% of households in rural areas have access to the piped water supply. These are the areas which are also affected by mining. In fact, Ramgarh falls in the list of aspirational districts of the NITI Aayog, given its poor human development indicators (NITI Aayog 2018).

Besides social infrastructure, coal mining has also not improved the overall economic status of the district. Ramgarh’s per capita GDP is nearly half of the all-India average. This places the district among the low-income category as per global standards. Over 63% of the district’s households have a monthly income below `10,000 (Bhushan et al 2020).

Finally, and most importantly, a focus on coal mining and related industry over decades has stymied the development of other sectors and the diversifi cation of the economy. Coal remains the single largest contributor to the district’s GDP, with a share of about 21%. In addition, other industries are also coal-reliant, such as coal washeries, thermal power plants, sponge iron units, refractories, etc. On the contrary, other potential sectors such as agriculture, forestry, fi sheries, and service sectors remain grossly underdeveloped. The situation has also contributed to a perceived sense of coal dependence in the mining areas. This is evident from the fact that while 27% households reported a direct income from coal, nearly three-fourths of the surveyed households expressed a sense of “perceived” dependence.

All of the above-mentioned factors, such as high proportion of informal workforce, low-income, poor social infrastructure and development indicators, a coal-centric economy, and underdevelopment of other economic sectors puts the district at a high risk from an unplanned coal mine closure. It therefore becomes imperative to plan a transition that is timely, deliberative and just.

Developing Policy Mechanisms
Just transition planning in India will not be a linear question of substituting a “mono” industry (coal) along with its workforce. Considering the nature of dependence and the poor socio-economic status of most coal mining areas in India, just transition will require “structural changes” to support a broad-based socio-economic transition. An integrated approach will be required to reverse the “resource curse” in coal mining areas, create sustainable economic opportunities, and build climate resilience. The Ramgarh experience also clearly brings out that, considering the socio-economic complexity of the coal regions and the varied stakeholders, planning for a just transition must be a phased and deliberative process.

There will be six key components of just transition planning at the district level. This includes, defi ning a time frame for a just transition (including of phased closure of coal mines and coal-based power), establishing an inclusive transition planning mechanism, providing alternative employment opportunities for formal and informal workers in the short term, planning economic diver-sifi cation (including industrial restructuring) for the long term, improving social and physical infrastructure to build community resilience, and securing fi nancial resources to support a just transition.

However, a just transition plan cannot be implemented at the district level in absence of a well-structured governance mechanism, which is based on utmost principles of cooperative federalism between the union and the state governments, and an inclusive decision-making process by engaging various stakeholders.

The governance framework of just transition must include eight key pillars. These include strong support of the union and state government(s) on developing policies and mobilising financial support, a diverse coalition among various actors and stakeholders, an effective communication strategy on just transition to build stakeholder confi dence, economic diver-sifi cation and social sec urity planning, coal sector transition planning, development of social and physical infrastructure development, and securing public and private investments for the transition.
On the policy front, a crucial aspect will be developing a “national just transition policy.” The union government should develop the policy, including components of coal phase-out strategy at the national- and state-levels, plan for phasing out coal-based power and simultaneous incentivisation of clean energy, and regulatory revisions of the coal industry pertaining to mine closure and reclamation, leasing/lease transfer, la-bour, etc. The union government’s support will also be crucial for building on existing laws and schemes to enable locally deliverable actions, providing a financial package, and pushing for an international framework at the United Nations Framework Convention on Climate Change (UNFCCC) to support just transition in developing countries.
The state government, on the other hand, will be at the front line for dealing with just transition. This will require building a broad-based consensus, and a strategic action plan to phase out coal mining and coal-based power, develop-ing economic and industrial strategy to steer away from coal dependence in terms of revenue, employment, and industries, and develop a state-level policy on just transition aligned with the national framework.

The actual planning and implementation will happen at the district level, where all stakeholders will need to engage through a participatory process.

Conclusions
The overall scenario of coal mining and coal-based power in India, and specifi -cally the Ramgarh experience, shows that just transition is not a consideration of the future anymore. The issue is here and now. The Ramgarh study is a telling case of the subnational status of coal mining and coal regions. In many coal districts, mines are being temporarily or permanently closed without any framework in place to support the local economy and restore the local environment. Therefore, there is an immediate need to develop just transition plans and a policy framework for these areas to avoid economic and social disruptions. A well-planned just transition is also necessary to compliment India’s ambitious plan for energy transition, and enhance its efforts of climate change mitigation action.

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One of the most significant amendments in this regard is taking decisions on matters of DMFs. The Government had instituted DMF by amending the MMDR Act in 2015 to improve the social responsiveness of the mining sector. As specified in the law, the objective of DMF is to work for the interest and benefit of areas and people affected by mining and related activities.

The State Governments were entrusted with the primary responsibility of setting up DMFs in every mining district (of the respective state), through a notification.  At the same time they were also vested with the power to prescribe the composition and functioning of DMFs.

The 2021 Bill proposes to increase the Centre’s say on matters of DMF. It has been specified that the “Central Government may give directions regarding composition and utilisation of fund” by the DMF.

The question is, what does this mean for DMF implementation, if the Bill becomes a law.

To answer this, it is important to consider what has been going on with DMFs in various states, and whether a direction from the Centre is necessary on its composition and functioning.

The MMDR Amendment Act 2015, under which DMF has been instituted, specifies that its composition and functioning, should be guided by three important people-centric laws. These include, the constitutional provisions as it relates to Fifth and Sixth Schedules (for governing tribal areas), provisions of the Panchayats (Extension to Scheduled Areas) Act (PESA), 1996, and the Scheduled Tribes and Other Traditional Forest Dwellers (Recognition of Forest Rights) Act, 2006 (in short the Forest Rights Act).

However, the DMF Rules as developed by most State Governments frustrates this. This has also been affecting DMF implementation.

First let us consider the composition of DMFs. Barring a handful, DMFs in most states/districts are dominated by officials and political members. This is true even for DMFs in Scheduled districts. There is negligible representation of Gram Sabha members, or general mining-affected people in the DMF body. This has resulted in top-down decision making. In most top mining districts, the affected community for whom DMFs have been developed, barely have any knowledge of it, or have any say about how it operates.

Second is the issue of DMF functioning and fund use. In nearly six years time, while more than Rs. 45,000 crores have accrued to DMFs across various districts in India, there is little perceptible change on ground with respect to development indicators, and basic factors of human well-being.  

A major reason for this is lack of planning. Barely any DMF Trust has developed a DMF plan to use the funds in a targeted manner, and as per the need of the people who are the beneficiaries. This has led to ad-hoc decisions on fund use, without prioritizing issues where intervention is necessary. Just one example shows this clearly. While poverty and livelihood are critical issues for the mining-affected people, no substantial investment has happened. In the first five years, most districts have spent only 0-4% of  the DMF budget towards this. Equally neglected areas have been child development, healthcare etc. in many districts. At the same time, there has been no significant effort for delineating the mining-affected areas, or identifying the mining-affected people.

The Centre’s intervention, which the 2021 Bill now suggests, presumably can help to improve DMF implementation, if the right directions are given. The Pradhan Mantri Khanij Kheshtra Kalyan Yojana (PMKKKY) guidelines must also be revised considering the current challenges with DMFs.

What is urgently required for the states, is to revise their DMF Rules. This is where the Centre can issue necessary directions. This can include directions on:

• Revising the composition of DMF to include Gram Sabha members from directly mining-affected villages/panchayats (or ward members) in the DMF Governing Council. At least 10% of the members should be from directly affected villages (or wards if an urban area).
• DMF planning, including preparation of annual action plans, and perspective plans, by engaging experts.
• Identifying and notifying the beneficiaries (the mining-affected people) and delineating the mining-affected areas to improve effectiveness of fund use.
• Setting up of DMF office in districts for purposes of coordination, planning, monitoring, and public disclosure of information. There is already 5% of DMF funds available for this.
• Establishment of a state-level monitoring and co-ordination committee, for monitoring and co-ordination of DMF operations in various districts.
• Improving accountability by information disclosure in public domain, and mandating both financial and performance audits of DMF Trusts.

The bottom line is, the Centre’s increase in power to intervene on DMF implementation, should not mean more top-down control. The directions must uphold the spirit of DMF, which is of a people-centric institution.

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Q. 1 How important is coal for Jharkhand in the present day?

Jharkhand is one of the few states in the country that is blessed with rich mineral wealth. The state contributes to 32% coal reserves in India. Although, coal has always been an important resource for revenue generation for the state. But the state has not attracted investments worthy of its endowments. 
Additionally, lakhs of tribal and indigenous people have been displaced from their lands without proper rehabilitation benefits. It is therefore an irony that Jharkhand illuminates the country with its coal but is forced to live in darkness. Coal is important to Jharkhand but not at the cost of huge societal and environmental loss.

Q2. Is Jharkhand benefiting from coal as expected?

The abundance of mineral wealth has been a resource curse for Jharkhand. The state contributes to 32% coal reserves in India. However, the benefits accrued to the state aren’t in the same proportion and we lose more than we gain. There’s DMF which allows some developmental activities in the mining affected regions and communities, but its functioning needs to be streamline.

Q3. Under what conditions do you want to increase coal production in the state?

With the increase in coal production, state revenue will also increase. However, our government is determined to safeguard the interests and rights of people and state. The Union Government has opened up auctions for commercial mining within the coal sector. The auction area also includes Jharkhand. However, I had requested the central government to provide a moratorium of 6-9 months. In this regard, I had written a letter to Hon’ble Minister of Coal, Mines & Parliamentary Affairs, Government of India requesting that due to COVID-19 pandemic, many domestic/foreign players might not participate in the auction process due to travel restrictions and several enterprises facing financial liquidity crunch.
My government also wants to ensure that steps taken for sustainable mineral development are in harmony with prevalent social and environmental practices and the adverse costs on tribal populace and the ecologically fragile zones do not outweigh the benefits that we might get economically. 

Q4. What do you think are the challenges of coal mining in environmental and social terms? How is the Jharkhand government planning to offset or deal with these?

Over all these years, Jharkhand has been forced to drink ‘laal-paani’ and ‘kaala-paani’ due to mining activities. Many people were forced to leave their land. Those left behind were exposed to severe diseases and complications. As a result, much more deliberations are required with various stakeholders for creating a conducive policy framework. Thus, it is vital that a balance is struck between societal expectations, environmental preservation and economic growth.

Q5. The Intergovernmental Panel on Climate Change (IPCC) report has spoken about phasing out coal for climate change concerns. Do you think Jharkhand can transition to solar and wind energy from coal? If yes, how long do you think this transition will take? If no, what are the alternatives?

Climate change related issues are increasing at an alarming rate. Due to the erratic changes in climatic conditions, it is mostly those at the margins who are most affected. Therefore, switching to renewable energy resources becomes essential. My government is committed to exploring alternate energy resources, especially solar energy for both electrification, saving unforeseen costs of conventional sources and also for facilitating micro irrigation to farmers and farmers collectives.

Q6. A new concept called Just Transition in coal mining areas has been emerging. The basic idea is that local communities in coal mining areas/ coal districts should not become the victims of coal phase-out in the next 20/30 years as the IPCC report says. Therefore, it says that economic opportunities should be created for mining dependent communities in these areas. Given this, is the Jharkhand government open to developing a Just Transition plan in coal mining areas? If yes, what should be the major components of the just transition plan?

I have not heard much about the Just Transition concept. But my government welcomes any concept that provides equity to people and other stakeholders affected from coal mining, directly or indirectly in districts and zones affected by mining. 

Q7. A key component for transition towards a non-coal economy will be diversification of economic opportunities. What are some of the economic sectors in the state with growth opportunities that can substitute for the revenue and employment that the coal industry currently provides?

Jharkhand is rich in minerals. But it has also been endowed with rich and diversified natural resources across the state. Tourism is one of the sectors which has been left untapped until now. We have so many states in India which generate revenue by focusing solely on Tourism. Not only does it create revenue but also promotes conservation and sustainable use of natural resources. Although post COVID 19 recovery will take time, we are focused to create a nature-based tourism plan to attract citizens across the country towards natural beauty and alternative indigenous living practices, prevalent in the state. 

The other is NTFP (Non-Timber Forest Produce) based economy in Jharkhand. The NTFP based economy has never been given due attention until now. My government is working on strengthening the overall structure of NTFP based backward and forward linkages. I believe that with due policy in place – not only the tribals and forest dwellers will get a decent income but it will also accentuate sustainable use of natural resources. Jharkhand also has great potential for renewable energy, pharmaceuticals, textile and other rural based industrialization initiatives. We are also going to soon start a process to map out specific enterprises/ industrial units that could be promoted/ developed to boost our rural economy and economic resilience. 

Q8. Which social security measures should the government prioritize to facilitate a well-planned transition? What can be the main revenue sources for it?

We have been committed to ensure social inclusion in all our programmes in this brief 6 month period. We will also soon launch the Urban Wage Guarantee Initiative, a first in its country and want to understand how a safety net for intra-state workers could be created in urban and peri-urban areas through state commissioned public works. Jharkhand is blessed with an industrious labour force. Our government prioritizes keeping welfare and pride of the labour force and other people intact. Keeping this as our priority, we promoted direct engagement with the Border Roads Organization (BRO) when they had approached Jharkhand for labour force. Our government is working on developing a plan and policy measure to ensure the rights and welfare of the people of Jharkhand especially towards responsible business practices and establishing an aspirational and responsible migration pattern in the future, contrary to the distress migration that has been practiced. 

Q9. What is your opinion about the political momentum / or support for transiting to non-coal economy in the mining districts? How do you think a favorable political will can be built?

Jharkhand Mukti Morcha (JMM) has always fought for the rights of people of Jharkhand. We always support less extractive and more equitable platform for our state. Our coalition government and JMM welcome any opportunity to promote equitable opportunities for both industries and people.  

Q10. What do you think that can be done to build a multi-stakeholder consensus and engagement for a transition?

Multi-stakeholder consensus cannot be attained unless there is democratisation of processes. We have the political will to do that and will deliberate more once the larger socio-economic picture is clearer. We also need time – I spent 4 months tackling COVID-19 and it has been a learning time. There are several plans but definitely they will be laid in the times to come.

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The ongoing pandemic has certainly come as a harsh reminder of how important it is to strengthen our economic base, and advance livelihood opportunities that are less vulnerable to social disruptions. Appropriate policy measures to ensure this is the need of the hour. 

In India, we already have a number of laws and regulatory provisions, that have strong underpinnings for improving local economy and reducing vulnerability of local communities. 

District Mineral Foundation (DMF) as instituted under the Mines and Minerals (Development and Regulation) Amendment Act, 2015, is one of the most significant ones in this regard. 

DMFs are in place in 583 districts, spread across 21 states of India. The funds of DMF, that come as a mandatory payment by miners operating in these districts, currently stands at nearly Rs. 40,280 crores. So far, about 41% of this money has been spent on various developmental works, as per latest government records. 

As per the law, creating sustainable livelihood opportunities, and improving people’s employability through skill development, are among the ‘high priority areas’ of DMF investments. Other priority sectors include, healthcare, education, women and child welfare, clean water supply, sanitation etc. How the money can be spent on these issues, must be determined in a planned way through a bottom-up process. What these essentially mean, is that, if implemented well, DMFs have huge potential to create income opportunities that are sustainable and secure, and improve overall developmental outcomes of some of the country’s poorest and most vulnerable people. 

Tangible asset creation will lead to misplaced DMF investments

As a component of the mining reforms, the Ministry of Mines has proposed to revise the rules and guidelines pertaining to DMF, to “improve the focus of DMF funds towards creating tangible assets” in mining-affected areas. However, this is a highly problematic proposition and will create huge scope of fund misuse. 

The focus on ‘creating tangible assets’, will make DMF any other development programme. This is not why DMF was developed. DMF has been instituted with the precise purpose of improving the lives and livelihoods of mining-affected people and areas. The law and guidelines (the Pradhan Mantra Khanij Kheshtra Kalyan Yojana), make it clear that this will require planned investments in both hard and soft resources.

However, if creation of tangible assets is prioritized, it will lead to heavy spending on physical infrastructure, and undermine the importance of investing on soft-resources, which are crucial for improving various development outcomes. For example, in mining-affected areas of most districts, a primary reason for poor healthcare is not that we do not have buildings; there is a severe shortfall of doctors, staff nurses, laboratory technicians, medical equipment, ambulances etc. Low income among people and lack of health insurance, makes it difficult for them to access private or well-equipped facilities. Similarly, for education, the biggest reason of high dropouts or poor learning outcomes among children is that there is a shortfall of good teachers, regular staff, and other facilities in the schools. 

The penchant for tangible assets will also severely undermine the scope of investments on livelihood, the key ‘purpose’ of the reforms. The trend of DMF investments over the past 5 years shows that, most states and districts have spent the least on livelihood and income generation components for local communities in the rush to ‘build’ something. The allocation towards this, accounts for only 0-4% of the total budget, while infrastructure development in all sectors, including major roads and bridges, account for the major share of investments. 

If the Government wants to improve DMF implementation, it should provide clear directions on DMF administration, planning and investments, to ensure that DMF funds are effectively used to benefit the people who need it most, and in the best possible way. Here are six crucial points on which directions need to be given:

1. DMFs must identify the mining-affected people, the beneficiaries of this fund. Not identifying them until now has been one the major drawbacks of DMFs, and has left out some of the most distressed people.
2. In most states and districts, there is no clear guideline till date to identify and delineate directly and indirectly mining-affected areas. This task must be prioritized to make investments targeted.
3. Districts must have proper and dedicated administrative set-up for DMFs.  This will help in DMF planning and co-ordination, which is necessary to optimize DMF fund use. There is already scope of using up to 5% of DMF budget for this.
4. At least 60% of DMF funds must be used on directly mining-affected areas, alongside on ‘high priority’ issues.
5. To prevent the scope of fund mis-use and improve development outcomes, a cap should be prescribed for the percentage of DMF funds that can be spent on infrastructure development in any sector. The Government has deliberated on this earlier, and a 20%-30% cap can be prescribed. 
6. Finally, there is no alternative to DMF planning. Ad hoc directions cannot resolve the problem with DMF investments. Every DMF must develop annual and perspective plans considering the local context. Our Constitution and governance mechanisms have repeatedly recognized the merit of local level planning. 

DMF Rules and guidelines certainly require a re-look and reform. The Ministry held a meeting on this in January 2019, and recognized the need of a much comprehensive set of directions that states and districts should follow to optimize DMF fund use. We need a reform for DMF that will truly make local communities ‘atmanirbhar’ and ensure their long-term security. This will require focus on creating sustainable livelihoods and deep investments on social infrastructure, not just a focus on creating tangible assets. 

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