Bhubaneswar: An Odisha minister on Saturday said that rejection of the mining proposal on Niyamgiri hills was 'unfortunate' and steps would be taken to alternatively source bauxite for Vedanta's refinery.

"It is unfortunate that the UPA government is doing politics at the cost of development. We condemn the Centre for rejection of the mining proposal at Niyamgri hills," Steel and Mines minister R K Singh told reporters here.

Alleging that the UPA government was against development of poverty stricken Kalahandi district, the minister said the state government was taking steps to provide bauxite to Vedanta's 1 mtpa refinery at Lanjigarh in Kalahandi district, he said.

The minister said Vedanta could be given prospecting license on small deposits of bauxite in Kalahandi and Rayagada districts.

He said that the company could also extract bauxite from latrite ore which was available in the state.

"The Group of Ministers set by the state government has submitted its report on the supply of ore to local industries. Vedanta has made a presentation before the GOM," Singh said.

Kalahandi's Congress MP Bhakta Charan Das, on the other hand, welcomed the Centre's decision.

"It is a victory for the Dangaria Kanda tribals who made history by stopping mining at their place of worship," Das said.

Meanwhile, anti-displacement activists hailed the central government's decision.

"We are happy that the central government honoured the Supreme Court decision and the verdict of the local people," Prafulla Samantara, one of the petitioners against the Vedanta project, said.