Ousted Rio Tinto chief set to head under-fire Vedanta

The mining boss ousted from Rio Tinto after multi-billion pound writedowns for ill-judged take-overs is to become chief executive of controversial Vedanta Resources.

Tom Albanese left Rio in January last year after the company booked a $3bn (£1.8bn) hit on the value of coal assets in Mozambique that he had bought just two years earlier. He resigned amid a total of $14bn writedowns.

He was just one of several chief executives caught out by the industry's downturn who quit their giant companies, including Cynthia Carroll at Anglo American and Marius Kloppers at BHP Billiton.

At Vedanta, he will work under the watchful eye of hands-on founder Anil Agarwal – a factor that analysts said could severely crimp Mr Albanese's freedom to control the company.

He will be tasked with turning around a business that has been at the heart of environmental rows and corruption investigations in India for years.

The Church of England famously sold its stake in the company in 2010 amid concerns about the way it was treating tribes in eastern India.

Its project in the Niyamgiri Hills, in the eastern Indian state of Odisha, was blocked by local tribes who deem the hills sacred.

Meanwhile, its Sesa Sterlite subsidiary has been fighting corruption allegations in Karnataka, a region of India so rife in such practices that one report by a former supreme court judge into the mining industry in general there claimed: "Huge bribes were paid. Mafia-type operations were the routine practice of the day."

Vedanta and Sesa Sterlite strenuously deny the allegations against their operations and a ban imposed on their work in the region in 2011 was only lifted in December. The ban was imposed on all mining companies in the area until corruption was cleaned up.

But India's Central Bureau of Investigation recently launched a probe into Mr Agarwal's 2002 takeover of the state's 26 per cent holding in another company, Hindustan Zinc.

That deal, too, was run through Sesa Sterlite and the investigators are examining how it was that the privatisation took place without parliamentary approval.