Tamil Nadu’s Illegal Sand Mining Scandal: ED Report Uncovers ₹4,730 Crore Loss

A massive illegal sand mining network infiltrating Tamil Nadu has been exposed after the Enforcement Directorate (ED) investigation lays out how rampant corruption, environmental impairment, and money laundering are linked to this business. These illegal activities, which took place between 2020 and 2023, involved Contractors, Politicians and bureaucrats, causing an estimated damage of ₹4,730 crore to the state exchequer, according to an exclusive dossier accessed by CNN-News18.

Unauthorized mining activities are outlined in the report, along with the illegal sale of heavy machinery. 209 excavators, mainly from Kobelco and JCB, were sold to people associated with the SR Group, who subsequently operated them in restricted locations like Kandaneri and Arumparuthi. GPS tracking data affirmed their utilization outside the authorized mining areas. Government officials acknowledged that extraction had greatly surpassed allowable limits.

An institute-led survey corroborated large-scale violations, showing that sand was excavated 10 to 30 times the approved levels. Even with the government’s online booking system designed to monitor sand extraction, contractors routinely flouted restrictions, using loopholes to extract unlimited amounts.

However, the dossier also exposes how contractors ran a sophisticated system of unaccounted cash transactions — with government officials willingly acting as facilitators. Proscribed heavy machinery, such as Poclains and JCBs, was extensively, used cementing the entrenched collusion between officials and illegal miners.

The report prepared by Terraqua UAV, a company set up by IITians, indicated illegal mining of about 23.64 lakh units of sand over 105 hectares, which is far above the permitted area of 4.90 hectares. It was the key operators S Ramachandran, P Karikalan, and K Rathinam (who were also arrested), who were running the show through benami (proxy) operators, as only three to four persons were controlling the business.

The ED dossier also points the finger at senior officials like Executive Engineer Asokan Mutha, who acknowledged rampant over-extraction and artificially inflated black-market prices — reaching up to ₹30,000 a unit, compared to an official 2,600. To obscure its source, the illegally obtained funds were passed through a series of accounts, a common money laundering technique.

The revelations suggest a wider systemic corruption and environmental menace at the mining sites, which may require immediate action to reinstate accountability in the Tamil Nadu sand mining industry.