Finally, Govt begins addressing core issues for boosting coal output

Desperate times call for desperate measures. And, the recent directive of the Prime Minister's Office asking Coal India to ensure supply of the much needed fuel to power projects may be considered as one such measure, necessitated by long inaction of the same Government in resolving some basic issues to unleash growth.

However, any initiative to step up coal output should have its bearings on a range of issues related to land acquisition and the rehabilitation and resettlement (R&R) of the affected people, environment and forest clearances, creation of adequate evacuation logistics and others.

And, if sources are to be believed, the Government has finally woken up to the reality. While expectation is high that issues related to the core sector may occupy a sizable portion of the Budget, indications are aplenty that things have already started moving in this direction.

New R&R Policy 

The first indication, indirectly though, was offered by none other than the acting CIL chief and the Additional Secretary in the Ministry of Coal, Ms Zohra Chatterji, during a media conference in Kolkata on February 17. “A new R&R policy to be formulated,” she said, refusing to divulge further details before the CIL board considers the same.

Incidentally, the company was required to acquire as much as 60,000 hectares during the Eleventh Plan (2007-12) to step up production by around 160 million tonne to 520 mt.

In reality, only a fraction of the requisite land could actually be acquired.

“Considering the growing resistance to land acquisition, R&R holds the key to monetisation of assets,” a company official said.

Evacuation logistics

Some breakthrough is also evident in the long neglected area of coal evacuation logistics. Business Line has reported how non-completion of 50-100 km of rail-links is holding up CIL in optimising nearly 300 million tonnes of mining output annually from Magadh (20 mtpa) and Amrapali (12 mtpa) in Jharkhand; Vasundhara (70-75 mtpa) in Orissa; and Mand-Raigarh (200 mtpa) in Chhatisgarh.

The company is now asked to “invest aggressively” in creating the necessary links. “We will be investing nearly Rs 6,000 crore in creating rail-links in the three States in the next five years,” CIL's Director Finance, Mr A. K. Sinha, said. To start with, the company will invest in the Rs 1,500-crore rail-link for coal evacuation from Mand-Raigarh.

Other rail-links slated to attract CIL investment are: Tori-Shibpur-Hazaribagh (Jharkhand); McCluskiegan-Piparwar (Jharkhand); Angul-Kalinga (Orissa); Jharsuguda-Sandanha (Orissa).

Forest clearances

Incidentally, a number of such projects were held up for non-availability of forest clearances. A classic example is the proposed 100 km Tori-Shibpur-Hazaribagh (Jharkhand) — holding up an estimated 40 mtpa CIL output, and an additional 60 mtpa captive production.

Though till date the project got only stage-I forest clearance for the Tori-Shibpur segment, sources suggest that pressure is now mounting on the relevant ministry to take a final call on the entire project. “We are expecting this project to get due approval soon,” a source said.