As children, theyd probably have smugly watched Gregory Pecks arduous quest in McKennas Gold. They might even have smiled in disdain. For living in the Kolar Gold Fields (KGF) in Karnataka, they had occasion to touch bricks of the precious metal, savour the cosy comforts of a favoured enterprise, and sit down to tales of dipping deep into the bowels of the earth to reach the treasure. But now, as greying fathers, they face a trauma. The town with a halcyon past is now on the brink. Its favoured enterprise, the Bharat Gold Mines Ltd (BGML), will sink its shafts for the last time on March 31. And that will be the finale of a gold rush that began 120 years ago.
All these years, the mines have spawned a gold flow of 800 tonnes. In the market, this would fetch a whopping Rs 45,000 crore today. And the lode hasnt run out, the gold veins are not defunct yet. Nor is it a case where workers no longer want to tread the dark, damp, cavernous tunnels that lead to the deposits. There are more than 4,000 of them who would wager their last rupee that its not right to ring the death knell for the company now. This force of trained hands would even work on a new project rather than stretch out for dole.
But its the Union governments brutal resolve to turn away the entire workforce-4,306 in all-which will script an agonising doom for these families and a township that has an absorbing history. Its perhaps for the first time that the entire workforce of a public sector undertaking, sans the managing director, has been set a deadline to accept the voluntary retirement scheme. Post-March 31, its retrenchment or termination of services, for the government will not earmark even a rupee to continue BGMLs operations, except for safety measures. The reason: the accumulated losses so far total Rs 409 crore as the cost of extraction is about four times more than the market price for 10 gm of gold.
The separation package tots up to about Rs 2 lakh for each employee. Though the governments decision is in step with its intention of not supporting loss-making psus, the upshot of such a drastic move could be colossal: poverty, a spurt in school drop-outs and unemployed youth, adverse effect on health, migration, alcoholism and crime. Things might get even worse, for a large number of political parties have a presence here. "There will be some problems, but they will settle down on their own," is the meek defence of R. Gupta, the BGML managing director.
On March 22, Gupta faced a sit-in by the employees and officers as their salaries were not paid. A situation, wrought by myopic decisions of successive governments, that has further augmented the pathos of the miners. At their peak, the mines had 34,631 workers, 20,820 of whom were in jobs below the ground. But by 1991-92, the manpower had declined to 10,388 and then to 4,345 by 1998-99. Almost every miner here is a third or fourth-generation worker, their ancestors have toiled for the British company, John Taylor and Sons, and later the psu. Men whove endured great risks while prospecting at depths about 3 km below the surface; people who continue to dwell in ramshackle places and unhygienic conditions; who ran up debts to send their children to schools and later, to marry off the girls. Post-retirement, many have taken up menial jobs, some are even reduced to seeking alms.
l A typical miner like Arul Das, 42, has worked for 21 years, has five boys, the youngest studies in class one. His net salary: Rs 2,600. The VRS package: about Rs 2 lakh. His debts: Rs 60,000. Hes being treated for silicosis, a disease that afflicts miners because of the high content of silicon dust underground. His miner father died of silicosis after 19 years of service. Must pay a deposit and higher rent to retain his quarters after retirement.
l Shekaran, 42, is a third-generation miner with 23 years in the Golconda mines. Salary: Rs 2,050 a month; has silicosis. Of his three children, the youngest has just joined school. The VRS offer: Rs 2 lakh. Also has to pay the deposit and higher rent for the quarters.
l Yeshwanth Raj, 39, is a foreman at Nandydroog Mines; a fourth-generation employee; salary: Rs 4,000. At least six uncles and ten cousins are miners. "The ore is of lower grade, but we can touch production levels of 40 kg a month," he says.
The towns distinct lifestyle had earned it the sobriquet Little England. The original British company had built quite a town: convents, medical hospital, golf club, club-house with tennis courts, billiards tables, and a teak-floored ballroom, Bentleys and Morris cars on the driveways of elegant bungalows, impeccable lawns. Furniture and even crockery and cutlery was given to the officers. The workers had separate clubs in their colony with an emphasis on health and hygiene of the staff and their children.
Even in times when salaries were as low as 25 paise, it was a self-contained world. A life people like Ronald Alan Taylor, 49, foreman at the wagon-manufacturing unit, reminisce about. "We could dance all night at parties, the jerks, the twists, the tap dance, and walk away with the prizes. Now, everything has ceased. There are not even a quarter of the number of (Anglo-Indian) families left here as everyone has migrated to other places."
These were the only mines in the world with a staggering 64 km of shafts connected by 1,320 km of tunnels that crisscross the mining area of 8.5 sq km. Theyve seen days when the market price for gold was as low as Rs 1.82 per gram for almost six decades till the early 30s, which later rose to the equivalent of the IMF rate of $35 per ounce-a level maintained till the 60s. Now, they face a brusque and undignified closure.
Its not that the industry was beyond redemption. The government couldve paid BGML the market price rather than the lower, IMF-fixed one. The trouble, says former mines secretary K.S.R. Chari in his 85 report on minimising losses, was that the gold made over to the government wasnt taken "strictly...as a sale concluded as the government is treating the gold in its vaults as monetary backing for the countrys currency reserves." Also, as S. Rajagopal, president BGML labour union points out, while the number of shafts came down systematically, no diversification took place. Thus, instead of profits of Rs 1 crore a year envisaged over a seven-year period, BGML suffered losses of Rs 10 crore. Another alternative, Rajagopal says, was surviving on income from agricultural produce if the government hands over 13,000 acres of wasteland for the purpose.
The government has rejected an ICICI proposal for establishing a Rs 200 crore metallurgical plant as part of the BGML rehabilitation package. The ICICI, appointed as operating agency by the Board for Industrial and Financial Reconstruction (BIFR), had said the plant could extract about 12 tons of gold from 33 million tons of tailings dumped outside the mines. That wouldve work going for the next decade. But Gupta is dismissive, "Weve tried everything. We didnt make profits even after selling in the open market. The government cant use taxpayers money to prop up a loss-making unit for long."
The local legislator, M. Bhakthavachalam, has petitioned the state government to pressurise the Centre into infusing funds for a revival of the gold mines besides diversifying into wagon and coach production and an lpg bottling plant-possible as the town links Bangalore and Chennai. But with the government bent on striking off loss-making companies, this unique mining town might well be on the road to a dusty death.
