State-owned mining company Coal India Limited (CIL) said that it would continue to be the country’s leading producer of coal, even after the sector has been opened up to private companies. In a public statement , the company stated that commercial coal mining would not adversely affect the production or profitability of CIL.
“Key issues which will help us stay ahead of the competition include uniform quality of coal, cost efficiency in production and reliable timely delivery schedule, introduction of higher degree of mechanised mining and increased supplies are other focus points,” said Pramod Agarwal, Chairman, CIL.
The declaration comes at a time when its own labor unions and also state governments are protesting against commercial coal mining. CIL trade unions have announced that they will launch a three-day strike on July 2 against the decision of the Center to open up the coal sector to private players. Bharatiya Mazdoor Sangh, Hind Mazdoor Sabha, INTUC, AITUC and CTU called for an end to the auction of coal blocks for commercial mining.
At the same time, the Jharkhand State Government has brought an action against commercial mining before the Supreme Court, after its request to the Center for Delaying the Process has been denied.
Last week, the Center launched India’s first auction of coal mines for commercial mining and the sale on the open market of private companies. This was followed by a decision by the Union Cabinet to ease the qualification criteria and auction methodology to attract industry interest in commercial coal mining.
“Commercial mining complements our efforts in shoring up the country’s indigenous coal output, but may not be viewed as competition to Coal India. It would not unsettle us,” CIL said in a statement. It also added that over the years, CIL has become a cost efficient producer with improved quality of coal supply.
“These two factors will determine the sale of coal in the competitive environment,” said the company.
CIL currently holds 54% of India’s coal reserves totalling up to 319 billion tonnes. The Center has also recently allocated 16 blocks, increasing its resource capacity by 9 billion tonnes, CIL said.
In a written petition to the SC, the Jharkhand Government stated that the Centre’s decision to initiate the commercial mining process was contrary to Schedule V of the Indian Constitution, which refers to the ‘planned areas’ that fall under the government of the State. The state further argued that there is a need for a fair assessment of the social and environmental impact on the vast tribal population and the vast stretches of forest land in the state.
“The negative global investment climate prevailing due to Covid-19 which is unlikely to fetch reasonable returns proportionate to the value of the scarce natural resource through the impugned actions for commercial coal mining,” said the synopsis of the writ petition shared by Hemant Soren, chief minister Jharkhand and Jharkhand Mukti Morcha on their respective Twitter handles.
The State Government had written to the Center earlier on June 10, praising it for the opening up of the coal sector and extending its support. However, it called for a moratorium on the auction, citing the Covid pandemic and the liquidity crunch with domestic industries.
On the other hand, the Congress-led Chhattisgarh State Government has asked the Center to remove five coal blocks from the auction process in the ‘no-go’ zones. Of the 41 coal blocks that were offered at the commercial coal mining auction, nine are in Chhattisgarh. Five blocks, namely Mogra South, Mogra-II, Sayang, Madanpur North and Fatehpur East, are located in ecologically sensitive areas.
In a letter to the Center, the Minister of State for the Environment stated that these blocks fall in the Hasdeo Forest and Mand River and the Elephant Reserve Area. “I request that the coal blocks in the Hasdeo Forest and Mand Rivers as well as in the proposed elephant reserve area not be included in the upcoming auction,” said State Environment Minister Mohammed Akbar in a letter to the Union Ministry of Environment, Forestry and Climate Change.
