By Sudarshan Varadhan
CHENNAI (Reuters) - An Indian environment court set aside on Saturday the Tamil Nadu state government's order to close Vedanta's (NS:VDAN) copper smelter plant permanently, taking the company closer to reopening its facility in southern India.
The green court's decision came months after the smelter was ordered shut by Tamil Nadu over alleged pollution that led to violent protests in May, which culminated in police opening fire on demonstrators and killing 13.
However, Vedanta's copper smelter plant is unlikely to resume production anytime soon as the Tamil Nadu state government is expected to appeal against the verdict to the country's top court.
"Our stand is clear: we do not want this smelter to reopen," Tamil Nadu's environment minister, K.C. Karuppannan, said in a televised news conference after the court order.
The court directed the Tamil Nadu state pollution regulator to pass a fresh order of renewal of consent for Vedanta's copper smelter within 3 weeks. It also directed the company to spend 1 billion rupees ($13.91 million) within a period of three years for the welfare of inhabitants in the area.
"We allow this appeal, set aside the impugned orders and direct the TNPCB (Tamil Nadu Pollution Control Board) to pass a fresh order of renewal of consent and authorisation to handle hazardous substances ... within three weeks from today," the National Green Tribunal said in the order.
Vedanta Ltd is part of the oil-to-metals conglomerate Vedanta Resources (LON:VED), which is controlled by Indian businessman Anil Agarwal. The smelter is one of the two largest in India. Resuming production is crucial for the group as it faces rising costs and the impact of a slowing economy on demand for metals and energy.
Vedanta's Sterlite Copper welcomed the order and said it would take all the steps required by the court to restart operations.
A panel of experts set up by the tribunal said last month authorities in Tamil Nadu had failed to comply with procedures before shutting down the smelter.
However, locals have protested, throwing stones and setting vehicles on fire in Thoothukudi, formerly known as Tuticorin in May, to press for the plant’s closure. The protests led to a police shooting, which killed 10 people while another three died of their wounds, making it one of India's deadliest environmental protests.
"Both merit based issues concerning pollution and the basic question on whether the green tribunal can rule on something pertaining to a state government policy has not been addressed," said Fatima Babu, a long-time campaigner against the operation of the smelter.