The Union Minister for Heavy Industries and Public Enterprises, Mr Praful Patel, said on Tuesday that to rapidly increase coal production, the private sector needs to be given out mining contracts.
This will help the power sector to reduce production costs. Such benefits can then be passed on to the rest of the industry, helping them be more competitive at the global stage and meet the challenge of Chinese imports.
“Management contracts need to be given out for coal mining. Its one of the areas were we need quick reforms. Many industries have lost competitive advantage globally for this. We need to have much larger scale as growth will not only come from internal demand,” he said, while speaking at the Confederation of Indian Industry's Annual General Meeting.
Apart from the power sector, Mr Patel said that the other area of “huge concern” is infrastructure. Most port, road and airport projects get delayed and are under-built. This poses a challenge and increases costs for manufacturing firms, such as BHEL, which need to move bulky equipment across the country.
“India also needs to move much forward in agriculture. So many irrigation projects are under way, but not even 10 per cent gets completed in time. Huge investments have gone in these sectors,” he added.
Further saying that the cost of capital needs to be reduced, Mr Patel stressed on the need to arrive at a quick political consensus for reforms and increasing the flexibility and autonomy given to public sector companies.
Speaking at the CII event, Mr G.V. Sanjay Reddy, Vice-Chairman, GVK Power and Infrastructure, said that politics is not letting India fulfil its economic potential and confidence needs to be restored back in the country.
“These days all we talk about is problems, corruption, inflation and fiscal deficit. We need to take advantage of our assets to get growth back. The opportunity will not last forever,” he said.