Political opposition to commercial coal mining diminishes PDF Print E-mail
Wednesday, 22 August 2012 17:17
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Even as the political climate worsened with the BJP insisting Prime Minister Manmohan Singh resign for his alleged role in the R1.86-lakh crore coal mine allocation scam and Parliament being adjourned over this, doors appear open for a complete overhaul of coal mining in India. This includes not just allowing auctioning of mines for captive users such as power and steel producers, but also allowing commercial coal miners such as BHP Billiton and Rio Tinto into the country.

While the government has been hesitant to push for this — it amended the MMDR Act in 2010 to allow auctions of mines for captive use — the opposition BJP has made it clear it was in favour of commercial mining as well. This flies in the face of the government’s argument that lack of political consensus is holding up this crucial reform.

At a press conference on Tuesday, deputy leader of the opposition in the Rajya Sabha Ravi Shankar Prasad said the NDA had even brought a Bill to this effect in 2000. While the Coal Mines (Nationalisation) Act of 1973 does not allow private mining, the Coal Mines (Nationalisation) Amendment Bill, 2000, specifically allows commercial mining subject to conditions like the mine size and locations.

Since it was introduced in the Rajya Sabha, it remains a live Bill though two governments have changed since. “If the government was interested, it could have moved to have our Bill passed,” Prasad said.

Under the Bill, apart from the government or government-controlled companies, any company “may carry on coal mining operations in India, in any form either for own consumption, sale or for any other purpose in accordance with the prospecting licence or mining lease or sub-lease”.

As per the Bill, India would have a demand-supply gap of around 235 million tonnes by the end of the Plan period, and since it was not possible for Coal India and captive miners to meet this demand, “it is necessary to increase investments in coal output and make coal available to meet the needs of the economy”. For this reason, “it is proposed to amend the Coal Mines (Nationalisation) Act, 1973”. The Bill then sought to enable the Centre to prescribe conditions.

The Bill was referred to the standing committee on industry in April 2000 and then to the standing committee on energy in November 2000, whose report was tabled in Parliament in August 2001. The committee recommended “that the Bill be passed to facilitate Indian private companies to explore and mine coal and lignite without the existing restriction of captive mining”.

Attempts at a similar Bill in February 1999 didn’t work. While the Cabinet approved it, it could not be introduced in Parliament since the Lok Sabha was dissolved. The new government introduced another Bill in the Rajya Sabha in April 2000.


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