What this article is about?
De-allocation of coal mines.
○ e.g: Excess allocation to RIL.
Production did not meet expectations.
Allocated at throwaway prices.
Who are involved?
Ministry of Coal.
Ministry of Finance.
Power and Steel companies.
Prime Minister’s Office.
Coal and the Indian
Accounts for 67% of total energy
Meets 52% of primary commercial energy.
66% of power generation is coal based.
Mining Sector contributes 2.25% to the
Industry Sector which is the main consumer
contributes to 14% of the GDP.
Some more numbers:-
58 coal blocks stuck
due to external
18 blocks expected
to start production
Companies with no prior experience in
mining were allotted coal blocks.
Allotment based on recommendations from
various high profile individuals.
17 companies who didn’t show up at the
before screening committee were allotted
Screening committee was made most
powerful within 5 months of UPA 1.
Windfall gains to private players.
Defensive Government Strategy due to:
Concerns of State Governments.
Need to amend associated acts.
Gestation period of 3-7 years.
To keep the prices low.
For interests of CIL.
Why is the government under
High cost of merchant power.
Low production of coal.
Gestation period of most mines are over.
Even after repeated reports of audit
committees auctioning was not implemented.
Asked for show-cause notices from
operators of 58 coal blocks
provide details of investments
provide progress on projects
provide details of mine development
De-allocation for those who
Have not seriously followed up for clearances
Have not invested in setting up end plants
CBI will investigate allocations done in a
IMG’s recommendation after investigation.
• Freeing of
• Better pricing of
• Incentive to
• Diverse effect on
• Conflicts with
• Could lead to an