Infra gap forced coal imports, says govt.

NEW DELHI: Under cutting the argument that Coal India Ltd's (CIL) inability to meet demand led to a spurt of private players in mining, the coal ministry has pointed to policy paralysis symptoms like a choked infrastructure and logistical mismatches for shortfall of the mineral.

Coal shortages grew particularly acute under UPA-II resulting in an increasing gap between growth in coal-based thermal power generation and production of the mineral in the last three years. This saw the government encouraging import of coal to supplement supplies.

"While capacity constraints continued to restrict movement of coal from certain coal fields, both way traffic encouraged priority movement of imported coal often at the cost of indigenous coal," the coal ministry told Parliament's public accounts committee (PAC) recently.

Poor reliability of domestic supplies meant import of coal aggravated the situation. "Value added service of supply of imported coal at the doorstep of the (power) plants was also viewed by consumers as a great relief from vagaries of uncertain availability of railway wagons," the ministry said.

Even with regard to dispatch of coal offered by e-auctions, transport was a hurdle. "It was not coal shortage but bottle necks in transport infrastructure that mainly affected dispatch of coal and fuel supply agreement materialization in the last three years," it said. The growth of coal imports and crippling of CIL production is essentially due to the "...the retarded growth in the infrastructure of and logistics capacity affecting coal production and delivery" and failure to build pithead transport capacity increased the stress on railways.

Other factors that hurt domestic operations include delays in environment and forest clearances, the ministry said. The delays were the reason for scaling down production targets as expected growth from new projects did not take place.

In 2010-11, production at 431 million tonnes stagnated at the previous year's level primarily due to the comprehensive environment and pollution index and "adverse factors like land acquisition problems, relief and rehabilitation issues, law and order and lack of evacuation facilities".

"Efforts to enhance exploration quantum and speed are also getting seriously affected due to the non-availability of forest clearance. Drilling work has been stopped in certain areas of Jharkhand and Chhattisgarh by the forest authority," it added.


Source : timesofindia.indiatimes.com