The Coal Regulatory Authority Bill, cleared by the group of ministers appointed for the purpose, is unlikely to serve the purpose for which it was meant. By taking away two crucial functions from the authority — pricing of coal and allocation of coal blocks — it has been reduced to a toothless organisation. Under these circumstances, if the people concerned have lost interest in the bill, they cannot be blamed. Coalgate might have prompted the government to think of the bill but the need for reforms in the coal sector has been felt for a long time. In fact, it is the least reformed sector in the country, so much so that the systems followed in it are outdated.

Most problems facing the sector can be traced to the monopoly the public sector Coal India Limited and its subsidiaries enjoy. India has vast coal reserves but these companies have not been able to serve the needs of the primary consumers of coal like the power sector. One of the perennial complaints of the industries using coal as a raw material is about the quality of coal the CIL subsidiaries supply. Though there is clear evidence that the policy of nationalisation of coal has failed, there has been no attempt whatsoever to address the problems the failure has caused. Small wonder that today many Indian companies find it economical to import coal!

Monopoly in any form is unacceptable and detrimental to public interest. CIL has not been able to modernise mining of coal and it follows traditional, labour-intensive practices. The lack of competition is responsible for CIL’s slackness. Thus, there is a strong case for liberalising the coal sector and allowing the private sector to make a foray into it. However welcome the strict implementation of environmental law is, it should not be at the cost of meeting the needs of the power and other industries, which are dependent on coal. Speedy environmental clearances for mining and quicker transport of coal from the mines to the user industries need to be ensured.

Courtesy: The New Indian Express