Allottees of 60 coal blocks may have gained by Rs 1.97L cr
Ahead of an inter-ministerial panel taking stock of progress in developing coal blocks, the Coal Ministry has estimated that allottees of 60 mines may have got a whopping Rs 1.97 lakh crore benefit by getting them for free.
September 05, 2012 / 17:45 IST
Ahead of an inter-ministerial panel taking stock of progress in developing coal blocks, the Coal Ministry has estimated that allottees of 60 mines may have got a whopping Rs 1.97 lakh crore benefit by getting them for free.
The three-day meeting of the inter-ministerial group is slated to start from tomorrow to review the progress in 25 coal blocks allocated to the private parties.IMG, headed by Zohra Chatterji, Additional Secretary, Coal, was set up in July to recommend action against the coal block allottees for not meeting timelines set for beginning production.Also Read: 5 of 25 cancelled blocks alloted to CIL, JSPL & othersFollowing the method used by the government auditor CAG in estimating the over Rs 1.85 lakh crore loss in allotment of coal mines since 2004, the Coal Ministry has ascertained that the 60 blocks with 6.7 billion tonnes of extractable reserve could be valued at nearly Rs 1.97 lakh crore.Sources said these 60 blocks were awarded to firms, both private and public, without competitive bidding between 1998 and 2009. Of these 60 blocks, seven were allocated during the BJP-led NDA regime between 1998 and 2004 while 53 blocks were given away during the UPA regime.The allottees which got the blocks face punitive action for failing to meet timelines for beginning production. An inter-ministerial group of officials is considering action in such cases.The seven blocks awarded during the NDA time had a cumulative extractable reserve of 420 million tonnes and these might have accrued Rs 12,421 crore undue benefit, if the CAG methodology of calculation of undue gains made by private firms is taken into account, a coal ministry document said.Out of these 60, 19 have been considered in the recent CAG report, which pegged a whopping Rs 1.86 lakh crore gain to private parties from allocation of 57 blocks between 2005 and 2009."Out of 99 coal blocks allocated to private players since 1993, 60 coal blocks with 6.7 billion tonnes valued at nearly Rs 1.97 lakh crore can be cancelled due to lack of progress as ascertained by the Coal Ministry in the meeting of January, 2012," said a source."60 blocks having almost all the reserves cited by CAG (6.7 billion tonnes) can be cancelled and handed over to Coal India for development immediately as the present allocatees have not concluded land acquisition," the source added.To compensate the regulated sectors, which have been set up on the basis of these blocks, linkage from Coal India may be granted and fuel supply agreements signed as per policy.This is aimed at ensuring that the developers do not get affected, investments in end-use plants do not get stranded and investor sentiment is not affected."The other sectors always retain the option of participating in competitive bidding for coal blocks or importing coal to fulfil their requirements," he added. Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
