Tender document for e-auctions of cancelled coal blocks will be out by December 22

01 Dec 2014 CW Staff

Anil Swarup, Secretary, Ministry of Coal, Government of India
Efficiency could well be the middle name of Anil Swarup who set a clearance track record as head of the Project Monitoring Group (PMG).

And, following a recent announcement, he has taken over as Secretary, Ministry of Coal, Government of India. His appointment has come at a time when the sector is log-jammed after a Supreme Court judgement de-allocated captive mines allocated over the past two decades. Difficult times to be sure, but then Swarup has never been one to shy away from a challenge. Informing us that he will continue to use the PMG portal to get clearances for coal projects, his vision is set in his new role: ´India should become self-sufficient in coal.´ In an exclusive conversation with SHRIYAL SETHUMADHAVAN, Swarup shares his views on the current industry sentiment and the transparent way forward.

India´s coal output productivity is among the lowest in the world. Why? And how can things be improved?
In India, we have not used technology to the extent that it ought to have been and this is one reason why productivity is low. In a strategy paper that we plan to bring out in a month´s time, one focus area is bringing in new technology to increase productivity. Technologies are available world over, and it is high time we get them in through various instruments.

The industry has been abuzz with the Supreme Court ruling de-allocating almost all the captive coal mining blocks allocated between 1993 and 2010...
We look at this as an opportunity to reform the sector as a whole. We are trying to work out a transparent system through which e-auction can happen for the 204 coal blocks that have been cancelled. Then, they can be given to companies that bid in the e-auction through objectively determined criteria. Further, the Supreme Court ruling gave the government the opportunity to look at the sector as a whole. So now, private-sector investment could come in for commercial exploitation of these mines, which would lead to bringing in better technology to improve productivity. Last, we have looked at the judgement as an opportunity to set the ball rolling to ramp up the production of Coal India Ltd from the present levels of 460 million tonne to almost 1 billion tonne by 2019. And we are working on a strategy paper to determine the same.

By when can we expect the norms for e-auctions for the cancelled coal blocks to be tabled?
E-auctions entail that the bids are visible to others and they can bid against them. It will be a completely transparent mechanism of auctioning. In terms of norms, timelines are clearly drawn. By December 22, 2014, the tender document will be out; it will have all the norms and by March 16, 2015, we would have taken a final call on who is going to get the mines.

Coal India Ltd has been mandated to take over the operations of these de-allocated mines from April 2015...
I don´t think there would be a need to do that because we would have taken a decision on the next allotting before that.

In your new role, what will the challenges be for you?
The first and foremost challenge is the decision of the Supreme Court and the consequences thereof. The second challenge we are looking at is ramping up coal production, and this has some associated challenges not only in terms of production but evacuation of coal. And then there are other challenges relating to additional railway lines, improving the number of rakes and the turnaround time.

In what way is the government´s ´Make in India´ initiative expected to impact the coal sector?
At present, India is short of coal and about 180 million tonne is being imported. So, if that coal becomes available in the country, nothing like it. Ultimately, when you have to make anything in India, you require energy, most of which comes from coal. So if the coal sector improves, the energy scenario will improve, following which production will improve. That is how it will impact ´Make in India´.

Anil Swarup, Secretary, Ministry of Coal, Government of India Efficiency could well be the middle name of Anil Swarup who set a clearance track record as head of the Project Monitoring Group (PMG). And, following a recent announcement, he has taken over as Secretary, Ministry of Coal, Government of India. His appointment has come at a time when the sector is log-jammed after a Supreme Court judgement de-allocated captive mines allocated over the past two decades. Difficult times to be sure, but then Swarup has never been one to shy away from a challenge. Informing us that he will continue to use the PMG portal to get clearances for coal projects, his vision is set in his new role: ´India should become self-sufficient in coal.´ In an exclusive conversation with SHRIYAL SETHUMADHAVAN, Swarup shares his views on the current industry sentiment and the transparent way forward. India´s coal output productivity is among the lowest in the world. Why? And how can things be improved? In India, we have not used technology to the extent that it ought to have been and this is one reason why productivity is low. In a strategy paper that we plan to bring out in a month´s time, one focus area is bringing in new technology to increase productivity. Technologies are available world over, and it is high time we get them in through various instruments. The industry has been abuzz with the Supreme Court ruling de-allocating almost all the captive coal mining blocks allocated between 1993 and 2010... We look at this as an opportunity to reform the sector as a whole. We are trying to work out a transparent system through which e-auction can happen for the 204 coal blocks that have been cancelled. Then, they can be given to companies that bid in the e-auction through objectively determined criteria. Further, the Supreme Court ruling gave the government the opportunity to look at the sector as a whole. So now, private-sector investment could come in for commercial exploitation of these mines, which would lead to bringing in better technology to improve productivity. Last, we have looked at the judgement as an opportunity to set the ball rolling to ramp up the production of Coal India Ltd from the present levels of 460 million tonne to almost 1 billion tonne by 2019. And we are working on a strategy paper to determine the same. By when can we expect the norms for e-auctions for the cancelled coal blocks to be tabled? E-auctions entail that the bids are visible to others and they can bid against them. It will be a completely transparent mechanism of auctioning. In terms of norms, timelines are clearly drawn. By December 22, 2014, the tender document will be out; it will have all the norms and by March 16, 2015, we would have taken a final call on who is going to get the mines. Coal India Ltd has been mandated to take over the operations of these de-allocated mines from April 2015... I don´t think there would be a need to do that because we would have taken a decision on the next allotting before that. In your new role, what will the challenges be for you? The first and foremost challenge is the decision of the Supreme Court and the consequences thereof. The second challenge we are looking at is ramping up coal production, and this has some associated challenges not only in terms of production but evacuation of coal. And then there are other challenges relating to additional railway lines, improving the number of rakes and the turnaround time. In what way is the government´s ´Make in India´ initiative expected to impact the coal sector? At present, India is short of coal and about 180 million tonne is being imported. So, if that coal becomes available in the country, nothing like it. Ultimately, when you have to make anything in India, you require energy, most of which comes from coal. So if the coal sector improves, the energy scenario will improve, following which production will improve. That is how it will impact ´Make in India´.