Mining, along with tourism, forms the economic backbone of India's seaside state of Goa. Environmental concerns recently halted much of the iron ore extraction, but the way has been now cleared for resumption of mining, in a way that is supposed to be environmentally friendly. VOA's Steve Herman reports from Goa.

A meeting of tribal communities is taking place on the grounds of a church in the ramshackle Goan fishing village of Betul.

Catholic priests have raised the alarm about a huge bauxite mine and other development projects planned for the area.

Rajendra Kerkar, a local fisherman, needs no convincing.

Kerkar says he fears the worst if authorities allow a million tons of bauxite to be mined annually near his house. The jobs will go to outsiders, he says, and illegal mining has already contaminated the groundwater, causing kidney failure among villagers. Dust is blanketing the area and blasting is shaking their homes.

This type of conflict between residents and mining companies is common in Goa.

India's Supreme Court in January allowed extraction of iron ore to resume at 16 locations, on the condition the operators pay a combined $25 million in compensation to the state forest department for environmental damage.

Goa exports 35 million tons of ore annually - mainly to China, Japan, South Korea and Europe - and the court ruling brought relief to the mining industry. It disappointed environmentalists, who say that for every ton of ore extracted, up to three tons of waste are produced.

Mining here dates to the 1950's, when Goa was still a Portuguese colony. Goa Foundation director Claude Alvares says no one envisioned large-scale, open-cast extraction, which scars the environment and threatens the vitality of a major tourist destination.

"The leases were granted at that time on the assumption that they would be largely manually operated, small-scale," he explained. "And nobody ever thought that Japan would one day come here with all their huge excavating machines and enable a rapid increase in the way in which ore would be extracted."

P.K. Mukherjee is managing director of Sesa Goa, one of the state's largest mining companies. He explains that large-scale extraction is more economical than what is called "pocket" mining.

"In that case, what happens is that everybody focuses on a particular pocket where the good ore is available," said Mukherjee. "So you just disturb the good ore and take the cream out of it. In the process, there are some low-grade ores, which we could have blended and used it. That becomes uneconomic. So in the process the huge amount of reserves gets wasted."

Sesa Goa says it does not conduct operations without environmental safeguards, and some environmentalists agree it is one of the most responsible major operators. Mukherjee says most mining companies in Goa are environmentally responsible.

"Generally, in Goa the mining companies are quite focused on their environmental liabilities. They are always trying to do the best what they can give back and restore the environment," added Mukherjee.

Environmentalists say it is just not a matter of restoring stripped land, however. Pravin Sabnis of the Save Goa Movement says the very presence of the mines upsets the ecological balance.

"We have a lot of cases of elephants and tigers and leopards coming into villages. All this is happening because their homes are being just destroyed by mining," he said.

That is why activists have gone to court, and in many cases, in Goa and elsewhere in India, judges eventually agree that the environmentalists have a good case. But Sabnis says it can take too long.

"The legal process is so tedious and complicated that by the time you win the battle, the land might have gone," continued Sabnis.

Official statistics show mining surpassing tourism as Goa's biggest producer of foreign exchange. But architect Dean D'Cruz, an adviser to the state government on land use, says Goa does not benefit.

"Mining is completely destructive of large tracts of land. And what it actually provides as economic development is a pittance. It doesn't even go to the state. It goes to the center [as] some royalty," he said.

Sesa Goa's managing director Mukherjee asserts that Goa does benefit, in terms of jobs, duties and taxes.

"Sustaining this employment itself is a direct contribution. Sales tax, excise duty, export duty nowadays, corporation tax and income tax," he said. "The biggest sales tax provider in Goa is the oil. It is basically getting consumed in the mining industry."

Regardless of whether mine operators or environmentalists ultimately prevail, the clock is ticking for the industry. Mine owners say that with present extraction and production technologies, Goa will be out of iron ore in about 20 years.