A panel set up by India's Ministry of Environment & Forests said Monday an approval for a Vedanta Resources PLC (VED.LN) project to mine bauxite in east India will cause serious damage to the survival of tribes and forest land in the Niyamgiri Hills.

The panel report said the project could destroy around 7 million sq. kilometers of forest lands and added that Vedanta has already "illegally occupied" 26.12 hectares of forest land in the region despite not receiving federal approval for going ahead with the mining project.

"This is an act of total contempt for the law on the part of the company and shows an appalling degree of collusion on the part of the concerned officials," the panel said.

The panel added that allowing the project to go ahead would have "serious consequences for the security and well being of the entire country."

- By Prasenjit Bhattacharya, Dow Jones Newswires; 91-11-4356-3358; prasenjit.bhattacharya@dowjones.com

 
 
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