India's top court allowed on Friday limited resumption of iron ore mining in a southern state that was suspended a week ago following revelations of a $3.6-billion mining fraud. While activities of private mining companies remain suspended in Bellary in Karnataka state, India's largest iron ore miner, state-run NMDC, will be allowed to operate two mines in the district, the Supreme Court said.
However, extraction will be limited to "100 million tonnes a month," none of which can be exported, the court said in a written order. On July 29, the court had suspended all mining activity in Bellary where companies have been accused of conniving with government officials to mine ore illegally. A corruption ombudsman said the fraud had cost the Karnataka state and federal exchequers 160.8 billion rupees ($3.6 billion) from 2006 to 2010 and recommended that the state chief minister B.S. Yeddyurappa be prosecuted.