Commercial mining won't hit Coal India, says CMD even as unions plan strike

Topics Coal India | 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. Pramod Agarwal (above), Coal India chairman
State-owned mining major Coal India (CIL) said it would continue to be the country’s leading coal producer even after the sector was opened up for private companies. 

In a public statement, CIL said commercial coal mining would not adversely impact its production or profitability. 

“Key issues that will help improve to 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,” said Chairman Pramod Agarwal.

The statement comes at a time when its own labour unions and state governments are protesting against commercial coal mining. CIL trade unions have announced they would go on a three-day strike from July 2 against the Centre’s decision to open the coal sector for private players. Bharatiya Mazdoor Sangh, Hind Mazdoor Sabha, INTUC, AITUC, and CTU have demanded that auction of coal blocks for commercial mining should stop. 

At the same time, the Jharkhand government has moved the Supreme Court against commercial mining, after its request to the Centre for delaying the process was denied. 

The Centre last week commenced India’s first auction of coal mines for commercial mining and sale in the open market by the private companies. This followed a Union Cabinet decision 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. 

Over the years, CIL said, the company had become a cost-efficient producer with improved quality of coal supply. “These two factors will determine the sale of coal in the competitive environment.” 

CIL holds 54 per cent of India’s coal reserve of up to 319 billion tonne. It was recently allocated 16 blocks by the Centre, increasing the resource capacity by 9 billion tonne, CIL said.

In a writ petition to the SC, Jharkhand has said the Centre’s decision to commence commercial mining process flouts Schedule-V of the Indian Constitution, which refers to the ‘scheduled areas’ falling under the state government. The state has further contested that there is need for fair assessment of the social and environmental impact on the huge tribal population and vast tracks of forest land in the state.

“The negative global investment climate prevailing due to Covid-19 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 petition shared by Jharkhand Chief Minister Hemant Soren on Twitter. 

The state had on June 10 written to the Centre, praising it for opening the coal sector and extended its support. However, it asked for a moratorium on the auction citing the Covid pandemic and liquidity crunch with the domestic industries. 

Congress-led Chhattisgarh government, on the other hand, has asked the Centre to remove five coal blocks from the auction process which fall in the ‘no-go’ zones. Of the 41 coal blocks offered in the commercial coal mining auction, nine are in Chhattisgarh. Five of the blocks — Mogra South, Mogra-II, Sayang, Madanpur North and Fatehpur East — are in ecologically sensitive areas. 

In a letter to the Centre, the state Environment Minister Mohammed Akbar said these blocks fall in the region of Hasdeo forest and Mand river and an elephant reserve area. “I request that coal blocks in the area of the Hasdeo forest and Mand rivers as well as those in the area of the proposed elephant reserve not be included in the upcoming auction,” the minister said in the letter to the Union ministry of environment, forests and climate change.

Maharashtra Tourism and Environment Minister Aaditya Thackeray condemned the commercial coal auction. “I have written to the Union Minister for @moefcc Prakash Javadekar ji on the issue of the proposed auction of a mine site near Tadoba- Andhari Tiger Reserve, opposing the auction. We cannot have such destruction of our wildlife corridors,” he tweeted.

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