Wednesday, December 25, 2013

Over-dependence on Coal India a myth: Coal secretary


Days after the country's competition watchdog fined public sector monopoly Coal India, coal secretary S K Srivastava on December 20 said the so-called over-dependence on the company is a myth in light of the captive block allocations by the government.
Vested interests are not inclined to allow a review of the Coal Mines Nationalisation Act , Srivastava said at the ET Infra Focus summit. Earlier this month, the Competition Commission of India imposed a fine of 1,773 crore on Coal India on grounds that it had abused its dominant position in supply of coal to the industry. There has been a growing clamour to remove Coal India's monopoly in the market, especially in light of the supply shortages by the world's largest coal producing company.

The government is targeting to add 60,000 MW of coal-based power capacity during the 13th Five-Year Plan."Coal India will cater to 55% of this capacity while state utilities and private sector will cater to the remaining 45% (through captive coal blocks). So, I think, it is a myth that there is an excessive dependence on Coal India," said Srivastava, adding that the government has been trying to bring in state utilities and private sector into coal mining, except for commercial mining, for end-use purposes.

"We are working under few constraints under the legislative framework of the Coal Mines (Nationalisation) Act and we need to address to this Act. However, certain groups are not inclined to a review of the Act. There is a possibility of a negative impact on the availability of coal in the country if an immediate review of the Act is done," Srivastava said, while discussing the issue of flexibility in coal mining and supply constraints in the country. "We are looking at other issues first ." he added.