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LATEST NEWS UPDATES | Coal mining policy: The dismantling of the 'go, no-go' policy may do little to improve supplies of coal by Avinash Celestine </title>
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In March this year, the Central Bureau of Investigation (CBI) raided the houses and businesses of a few top industrialists in Dhanbad, Jharkhand, home to one of the subsidiaries of India's biggest coal miner, Coal India (CIL). Dhanbad is more..."/>
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In March this year, the Central Bureau of Investigation (CBI) raided the houses and businesses of a few top industrialists in Dhanbad, Jharkhand, home to one of the subsidiaries of India's biggest coal miner, Coal India (CIL). Dhanbad is more..." />
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<h1 class="cat-box-title">Coal mining policy: The dismantling of the 'go, no-go' policy may do little to improve supplies of coal by Avinash Celestine</h1>
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Published on</span><span class="text-date"> Sep 24, 2011</span>
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<br /><div align="justify">In March this year, the Central Bureau of Investigation (CBI) raided the houses and businesses of a few top industrialists in Dhanbad, Jharkhand, home to one of the subsidiaries of India's biggest coal miner, Coal India (CIL). Dhanbad is more widely known in popular imagination as home of the infamous 'coal mafia', which spread a reign of terror across the coal mining districts of the then undivided Bihar in the 1970s and 1980s.<br /><br />The raids came after the CBI suspected that the industrialists were misusing their 'coal linkage' certificates. These certificates are in effect, a form of licence, which entitles the holder to quotas of subsidised coal for their business, whether its running a power plant, or a steel plant. The condition is that the coal cannot be resold to others but must be used by the certificate holders themselves. The industrialists were accused of violating this condition, and of benefiting from the huge and growing price differential between subsidised coal and the price of coal in the black market. Meanwhile, Odisha politics was hit by a Rs 125-crore scam involving diversion of subsidised 'linkage' coal to the open market by firms linked to politicians.<br /><br />Both these incidents are a symptom of the growing hunger for, and shortage of, domestic coal in the country. Whether it is the linkage scams in the heart of coal country, or the growing imports of coal by steel plants, or the recent acquisitions of overseas coal mines, such as the $1.26-billion deal by GVK Power to buy mines in Australia, or the fact that 14 power plants in the country have less than four days of coal stocks available, these symptoms are growing by the day.<br /><br />That coal shortage is projected to hit 137 million tons this year up from just 43 million tons barely five years ago, and has forced the government to resort to its favourite tactic when faced with a crisis - set up a Group of Ministers (GoM). It met this week and scrapped the contentious 'go, no-go' policy, which has had the coal and environment ministries at loggerheads for months now. Critics have claimed that the policy, which essentially blocks coal from being mined in heavily forested areas, stands in the way of greater coal production.<br /><br /><em>Iffy Issue<br /></em><br />CIL chairman NC Jha told ET on Sunday (a week and a half before the GoM meeting this week), that the potential production capacity of around 168 CIL coal blocks pending with the Ministry of Environment and Forests (MoEF) for forest clearances, was about 200 million tons a year. Total domestic production of coal was around 533 million tons in 2010-11. So if all these projects take off, they could have a big impact on coal output. But that's a big if. The 'resolution' of the 'go, no-go' issue has been touted as solving the problem of coal shortage, or at least go ing a long way towards fixing that shortage. <br /><br />In reality, it is likely to do little. If there does indeed exist a conflict between development on the one hand, and environmental concerns on the other, it is in the mining sector where this is the most apparent. A car plant can be shifted to another location if there are serious environmental or other social concerns. Coal or iron ore mines cannot.<br /><br />Here's the big irony about the whole nogo issue: it started off as an attempt to speed up forest clearances for coal projects. And here's the second irony: 'go, nogo' started off as a joint initiative of the coal ministry and the environment ministry. As late as August last year, coal minister Sriprakash Jaiswal told parliament this exercise was taken up 'jointly' by the ministries.<br /><br /><em>Digging in the Dark<br /></em><br />A senior official of National Thermal Power Corporation, the country's largest power company that owns a number of 'captive' coal blocks (mines owned by power or steel producers and dedicated to supplying coal for a given project or plant) was more explicit in his comments. "Go, no-go is a good idea. There were a number of coal blocks for which we would take the trouble to apply for forest clearances, only to have them rejected after a few years, as they were in dense forest areas. So we asked that such areas be identified in advance. We would then apply only in the 'go' areas."<br /><br />How the MoEF did this in essence, was to superimpose maps of dense forest areas over maps specifying coal bearing regions. The points where the two coincided were 'no-go' areas and the rest were 'go' areas. The distinction was to help miners to focus their exploration efforts on the 'go' areas. Up to 153 blocks were classified as 'no-go' areas and 449 blocks as 'go' areas. "Go, no-go is not the issue," said Jha. "For me what is important is that if it is a 'go' area then the forest clearance should come as quickly as possible, and not be delayed for months and months, if not years."<br /><br /><em>Back to Square One<br /></em><br />According to the latest coal ministry statistics, 286 captive coal blocks, with total geological reserves of 43.5 billion tons have been allocated to both private and government players. Till June last year, only 26 of these had actually started production - delays in forest clearances are only part of the reason. Land acquisition is another major reason. "Also, there was no serious thought to whom such blocks should be allotted," says a former senior CIL executive. "Many allottees are just sitting on coal blocks they were allocated." Recognising this, the coal ministry went ahead and cancelled a number of allocations because of delays in production. <br /><br />March this year, the rhetoric on 'go, no-go' had shifted subtly, and there was no more talk by the coal minister of working 'jointly' with the MoEF. He told parliament that the coal ministry had moved a note to the Cabinet Committee on Infrastructure on the need for "making available more coal-bearing areas...in view of the situation arising out of the stand taken by the MoEF consequent to categorising the forest areas into 'go' and 'no-go' areas".<br /><br />With the scrapping of the 'go, no-go' plan, the uncertainty has returned. There is again the possibility that miners may apply for a forest clearance only to face rejection later. And irrespective of whether 'go, no-go' exists or not, all coal blocks need an MoEF clearance if they happen to be on land owned by the forest department. The whole 'go, no-go' controversy has obscured the fact that it is these forest clearances which can take years to come through and which need to be speeded up. <br /></div>
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<br><a href="http://economictimes.indiatimes.com/news/news-by-industry/energy/power/coal-mining-policy-the-dismantling-of-the-go-no-go-policy-may-do-little-to-improve-suppli" class="re" target="_blank">The Economic Times, 25 September, 2011, http://economictimes.indiatimes.com/news/news-by-industry/energy/power/coal-mining-policy-the-dismantling-of-the-go-no-go-policy-may-do-little-to-improve-suppli</a><div class="clear"></div>
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<h1 class="cat-box-title">Coal mining policy: The dismantling of the 'go, no-go' policy may do little to improve supplies of coal by Avinash Celestine</h1>
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Published on</span><span class="text-date"> Sep 24, 2011</span>
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<br /><div align="justify">In March this year, the Central Bureau of Investigation (CBI) raided the houses and businesses of a few top industrialists in Dhanbad, Jharkhand, home to one of the subsidiaries of India's biggest coal miner, Coal India (CIL). Dhanbad is more widely known in popular imagination as home of the infamous 'coal mafia', which spread a reign of terror across the coal mining districts of the then undivided Bihar in the 1970s and 1980s.<br /><br />The raids came after the CBI suspected that the industrialists were misusing their 'coal linkage' certificates. These certificates are in effect, a form of licence, which entitles the holder to quotas of subsidised coal for their business, whether its running a power plant, or a steel plant. The condition is that the coal cannot be resold to others but must be used by the certificate holders themselves. The industrialists were accused of violating this condition, and of benefiting from the huge and growing price differential between subsidised coal and the price of coal in the black market. Meanwhile, Odisha politics was hit by a Rs 125-crore scam involving diversion of subsidised 'linkage' coal to the open market by firms linked to politicians.<br /><br />Both these incidents are a symptom of the growing hunger for, and shortage of, domestic coal in the country. Whether it is the linkage scams in the heart of coal country, or the growing imports of coal by steel plants, or the recent acquisitions of overseas coal mines, such as the $1.26-billion deal by GVK Power to buy mines in Australia, or the fact that 14 power plants in the country have less than four days of coal stocks available, these symptoms are growing by the day.<br /><br />That coal shortage is projected to hit 137 million tons this year up from just 43 million tons barely five years ago, and has forced the government to resort to its favourite tactic when faced with a crisis - set up a Group of Ministers (GoM). It met this week and scrapped the contentious 'go, no-go' policy, which has had the coal and environment ministries at loggerheads for months now. Critics have claimed that the policy, which essentially blocks coal from being mined in heavily forested areas, stands in the way of greater coal production.<br /><br /><em>Iffy Issue<br /></em><br />CIL chairman NC Jha told ET on Sunday (a week and a half before the GoM meeting this week), that the potential production capacity of around 168 CIL coal blocks pending with the Ministry of Environment and Forests (MoEF) for forest clearances, was about 200 million tons a year. Total domestic production of coal was around 533 million tons in 2010-11. So if all these projects take off, they could have a big impact on coal output. But that's a big if. The 'resolution' of the 'go, no-go' issue has been touted as solving the problem of coal shortage, or at least go ing a long way towards fixing that shortage. <br /><br />In reality, it is likely to do little. If there does indeed exist a conflict between development on the one hand, and environmental concerns on the other, it is in the mining sector where this is the most apparent. A car plant can be shifted to another location if there are serious environmental or other social concerns. Coal or iron ore mines cannot.<br /><br />Here's the big irony about the whole nogo issue: it started off as an attempt to speed up forest clearances for coal projects. And here's the second irony: 'go, nogo' started off as a joint initiative of the coal ministry and the environment ministry. As late as August last year, coal minister Sriprakash Jaiswal told parliament this exercise was taken up 'jointly' by the ministries.<br /><br /><em>Digging in the Dark<br /></em><br />A senior official of National Thermal Power Corporation, the country's largest power company that owns a number of 'captive' coal blocks (mines owned by power or steel producers and dedicated to supplying coal for a given project or plant) was more explicit in his comments. "Go, no-go is a good idea. There were a number of coal blocks for which we would take the trouble to apply for forest clearances, only to have them rejected after a few years, as they were in dense forest areas. So we asked that such areas be identified in advance. We would then apply only in the 'go' areas."<br /><br />How the MoEF did this in essence, was to superimpose maps of dense forest areas over maps specifying coal bearing regions. The points where the two coincided were 'no-go' areas and the rest were 'go' areas. The distinction was to help miners to focus their exploration efforts on the 'go' areas. Up to 153 blocks were classified as 'no-go' areas and 449 blocks as 'go' areas. "Go, no-go is not the issue," said Jha. "For me what is important is that if it is a 'go' area then the forest clearance should come as quickly as possible, and not be delayed for months and months, if not years."<br /><br /><em>Back to Square One<br /></em><br />According to the latest coal ministry statistics, 286 captive coal blocks, with total geological reserves of 43.5 billion tons have been allocated to both private and government players. Till June last year, only 26 of these had actually started production - delays in forest clearances are only part of the reason. Land acquisition is another major reason. "Also, there was no serious thought to whom such blocks should be allotted," says a former senior CIL executive. "Many allottees are just sitting on coal blocks they were allocated." Recognising this, the coal ministry went ahead and cancelled a number of allocations because of delays in production. <br /><br />March this year, the rhetoric on 'go, no-go' had shifted subtly, and there was no more talk by the coal minister of working 'jointly' with the MoEF. He told parliament that the coal ministry had moved a note to the Cabinet Committee on Infrastructure on the need for "making available more coal-bearing areas...in view of the situation arising out of the stand taken by the MoEF consequent to categorising the forest areas into 'go' and 'no-go' areas".<br /><br />With the scrapping of the 'go, no-go' plan, the uncertainty has returned. There is again the possibility that miners may apply for a forest clearance only to face rejection later. And irrespective of whether 'go, no-go' exists or not, all coal blocks need an MoEF clearance if they happen to be on land owned by the forest department. The whole 'go, no-go' controversy has obscured the fact that it is these forest clearances which can take years to come through and which need to be speeded up. <br /></div>
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<br><a href="http://economictimes.indiatimes.com/news/news-by-industry/energy/power/coal-mining-policy-the-dismantling-of-the-go-no-go-policy-may-do-little-to-improve-suppli" class="re" target="_blank">The Economic Times, 25 September, 2011, http://economictimes.indiatimes.com/news/news-by-industry/energy/power/coal-mining-policy-the-dismantling-of-the-go-no-go-policy-may-do-little-to-improve-suppli</a><div class="clear"></div>
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LATEST NEWS UPDATES | Coal mining policy: The dismantling of the 'go, no-go' policy may do little to improve supplies of coal by Avinash Celestine </title>
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In March this year, the Central Bureau of Investigation (CBI) raided the houses and businesses of a few top industrialists in Dhanbad, Jharkhand, home to one of the subsidiaries of India's biggest coal miner, Coal India (CIL). Dhanbad is more..."/>
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<h1 class="cat-box-title">Coal mining policy: The dismantling of the 'go, no-go' policy may do little to improve supplies of coal by Avinash Celestine</h1>
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<br /><div align="justify">In March this year, the Central Bureau of Investigation (CBI) raided the houses and businesses of a few top industrialists in Dhanbad, Jharkhand, home to one of the subsidiaries of India's biggest coal miner, Coal India (CIL). Dhanbad is more widely known in popular imagination as home of the infamous 'coal mafia', which spread a reign of terror across the coal mining districts of the then undivided Bihar in the 1970s and 1980s.<br /><br />The raids came after the CBI suspected that the industrialists were misusing their 'coal linkage' certificates. These certificates are in effect, a form of licence, which entitles the holder to quotas of subsidised coal for their business, whether its running a power plant, or a steel plant. The condition is that the coal cannot be resold to others but must be used by the certificate holders themselves. The industrialists were accused of violating this condition, and of benefiting from the huge and growing price differential between subsidised coal and the price of coal in the black market. Meanwhile, Odisha politics was hit by a Rs 125-crore scam involving diversion of subsidised 'linkage' coal to the open market by firms linked to politicians.<br /><br />Both these incidents are a symptom of the growing hunger for, and shortage of, domestic coal in the country. Whether it is the linkage scams in the heart of coal country, or the growing imports of coal by steel plants, or the recent acquisitions of overseas coal mines, such as the $1.26-billion deal by GVK Power to buy mines in Australia, or the fact that 14 power plants in the country have less than four days of coal stocks available, these symptoms are growing by the day.<br /><br />That coal shortage is projected to hit 137 million tons this year up from just 43 million tons barely five years ago, and has forced the government to resort to its favourite tactic when faced with a crisis - set up a Group of Ministers (GoM). It met this week and scrapped the contentious 'go, no-go' policy, which has had the coal and environment ministries at loggerheads for months now. Critics have claimed that the policy, which essentially blocks coal from being mined in heavily forested areas, stands in the way of greater coal production.<br /><br /><em>Iffy Issue<br /></em><br />CIL chairman NC Jha told ET on Sunday (a week and a half before the GoM meeting this week), that the potential production capacity of around 168 CIL coal blocks pending with the Ministry of Environment and Forests (MoEF) for forest clearances, was about 200 million tons a year. Total domestic production of coal was around 533 million tons in 2010-11. So if all these projects take off, they could have a big impact on coal output. But that's a big if. The 'resolution' of the 'go, no-go' issue has been touted as solving the problem of coal shortage, or at least go ing a long way towards fixing that shortage. <br /><br />In reality, it is likely to do little. If there does indeed exist a conflict between development on the one hand, and environmental concerns on the other, it is in the mining sector where this is the most apparent. A car plant can be shifted to another location if there are serious environmental or other social concerns. Coal or iron ore mines cannot.<br /><br />Here's the big irony about the whole nogo issue: it started off as an attempt to speed up forest clearances for coal projects. And here's the second irony: 'go, nogo' started off as a joint initiative of the coal ministry and the environment ministry. As late as August last year, coal minister Sriprakash Jaiswal told parliament this exercise was taken up 'jointly' by the ministries.<br /><br /><em>Digging in the Dark<br /></em><br />A senior official of National Thermal Power Corporation, the country's largest power company that owns a number of 'captive' coal blocks (mines owned by power or steel producers and dedicated to supplying coal for a given project or plant) was more explicit in his comments. "Go, no-go is a good idea. There were a number of coal blocks for which we would take the trouble to apply for forest clearances, only to have them rejected after a few years, as they were in dense forest areas. So we asked that such areas be identified in advance. We would then apply only in the 'go' areas."<br /><br />How the MoEF did this in essence, was to superimpose maps of dense forest areas over maps specifying coal bearing regions. The points where the two coincided were 'no-go' areas and the rest were 'go' areas. The distinction was to help miners to focus their exploration efforts on the 'go' areas. Up to 153 blocks were classified as 'no-go' areas and 449 blocks as 'go' areas. "Go, no-go is not the issue," said Jha. "For me what is important is that if it is a 'go' area then the forest clearance should come as quickly as possible, and not be delayed for months and months, if not years."<br /><br /><em>Back to Square One<br /></em><br />According to the latest coal ministry statistics, 286 captive coal blocks, with total geological reserves of 43.5 billion tons have been allocated to both private and government players. Till June last year, only 26 of these had actually started production - delays in forest clearances are only part of the reason. Land acquisition is another major reason. "Also, there was no serious thought to whom such blocks should be allotted," says a former senior CIL executive. "Many allottees are just sitting on coal blocks they were allocated." Recognising this, the coal ministry went ahead and cancelled a number of allocations because of delays in production. <br /><br />March this year, the rhetoric on 'go, no-go' had shifted subtly, and there was no more talk by the coal minister of working 'jointly' with the MoEF. He told parliament that the coal ministry had moved a note to the Cabinet Committee on Infrastructure on the need for "making available more coal-bearing areas...in view of the situation arising out of the stand taken by the MoEF consequent to categorising the forest areas into 'go' and 'no-go' areas".<br /><br />With the scrapping of the 'go, no-go' plan, the uncertainty has returned. There is again the possibility that miners may apply for a forest clearance only to face rejection later. And irrespective of whether 'go, no-go' exists or not, all coal blocks need an MoEF clearance if they happen to be on land owned by the forest department. The whole 'go, no-go' controversy has obscured the fact that it is these forest clearances which can take years to come through and which need to be speeded up. <br /></div>
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<br><a href="http://economictimes.indiatimes.com/news/news-by-industry/energy/power/coal-mining-policy-the-dismantling-of-the-go-no-go-policy-may-do-little-to-improve-suppli" class="re" target="_blank">The Economic Times, 25 September, 2011, http://economictimes.indiatimes.com/news/news-by-industry/energy/power/coal-mining-policy-the-dismantling-of-the-go-no-go-policy-may-do-little-to-improve-suppli</a><div class="clear"></div>
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LATEST NEWS UPDATES | Coal mining policy: The dismantling of the 'go, no-go' policy may do little to improve supplies of coal by Avinash Celestine
Coal mining policy: The dismantling of the 'go, no-go' policy may do little to improve supplies of coal by Avinash Celestine
Published on Sep 24, 2011
Modified on Sep 24, 2011
In March this year, the Central Bureau of Investigation (CBI) raided the houses and businesses of a few top industrialists in Dhanbad, Jharkhand, home to one of the subsidiaries of India's biggest coal miner, Coal India (CIL). Dhanbad is more widely known in popular imagination as home of the infamous 'coal mafia', which spread a reign of terror across the coal mining districts of the then undivided Bihar in the 1970s and 1980s.
The raids came after the CBI suspected that the industrialists were misusing their 'coal linkage' certificates. These certificates are in effect, a form of licence, which entitles the holder to quotas of subsidised coal for their business, whether its running a power plant, or a steel plant. The condition is that the coal cannot be resold to others but must be used by the certificate holders themselves. The industrialists were accused of violating this condition, and of benefiting from the huge and growing price differential between subsidised coal and the price of coal in the black market. Meanwhile, Odisha politics was hit by a Rs 125-crore scam involving diversion of subsidised 'linkage' coal to the open market by firms linked to politicians.
Both these incidents are a symptom of the growing hunger for, and shortage of, domestic coal in the country. Whether it is the linkage scams in the heart of coal country, or the growing imports of coal by steel plants, or the recent acquisitions of overseas coal mines, such as the $1.26-billion deal by GVK Power to buy mines in Australia, or the fact that 14 power plants in the country have less than four days of coal stocks available, these symptoms are growing by the day.
That coal shortage is projected to hit 137 million tons this year up from just 43 million tons barely five years ago, and has forced the government to resort to its favourite tactic when faced with a crisis - set up a Group of Ministers (GoM). It met this week and scrapped the contentious 'go, no-go' policy, which has had the coal and environment ministries at loggerheads for months now. Critics have claimed that the policy, which essentially blocks coal from being mined in heavily forested areas, stands in the way of greater coal production.
Iffy Issue
CIL chairman NC Jha told ET on Sunday (a week and a half before the GoM meeting this week), that the potential production capacity of around 168 CIL coal blocks pending with the Ministry of Environment and Forests (MoEF) for forest clearances, was about 200 million tons a year. Total domestic production of coal was around 533 million tons in 2010-11. So if all these projects take off, they could have a big impact on coal output. But that's a big if. The 'resolution' of the 'go, no-go' issue has been touted as solving the problem of coal shortage, or at least go ing a long way towards fixing that shortage.
In reality, it is likely to do little. If there does indeed exist a conflict between development on the one hand, and environmental concerns on the other, it is in the mining sector where this is the most apparent. A car plant can be shifted to another location if there are serious environmental or other social concerns. Coal or iron ore mines cannot.
Here's the big irony about the whole nogo issue: it started off as an attempt to speed up forest clearances for coal projects. And here's the second irony: 'go, nogo' started off as a joint initiative of the coal ministry and the environment ministry. As late as August last year, coal minister Sriprakash Jaiswal told parliament this exercise was taken up 'jointly' by the ministries.
Digging in the Dark
A senior official of National Thermal Power Corporation, the country's largest power company that owns a number of 'captive' coal blocks (mines owned by power or steel producers and dedicated to supplying coal for a given project or plant) was more explicit in his comments. "Go, no-go is a good idea. There were a number of coal blocks for which we would take the trouble to apply for forest clearances, only to have them rejected after a few years, as they were in dense forest areas. So we asked that such areas be identified in advance. We would then apply only in the 'go' areas."
How the MoEF did this in essence, was to superimpose maps of dense forest areas over maps specifying coal bearing regions. The points where the two coincided were 'no-go' areas and the rest were 'go' areas. The distinction was to help miners to focus their exploration efforts on the 'go' areas. Up to 153 blocks were classified as 'no-go' areas and 449 blocks as 'go' areas. "Go, no-go is not the issue," said Jha. "For me what is important is that if it is a 'go' area then the forest clearance should come as quickly as possible, and not be delayed for months and months, if not years."
Back to Square One
According to the latest coal ministry statistics, 286 captive coal blocks, with total geological reserves of 43.5 billion tons have been allocated to both private and government players. Till June last year, only 26 of these had actually started production - delays in forest clearances are only part of the reason. Land acquisition is another major reason. "Also, there was no serious thought to whom such blocks should be allotted," says a former senior CIL executive. "Many allottees are just sitting on coal blocks they were allocated." Recognising this, the coal ministry went ahead and cancelled a number of allocations because of delays in production.
March this year, the rhetoric on 'go, no-go' had shifted subtly, and there was no more talk by the coal minister of working 'jointly' with the MoEF. He told parliament that the coal ministry had moved a note to the Cabinet Committee on Infrastructure on the need for "making available more coal-bearing areas...in view of the situation arising out of the stand taken by the MoEF consequent to categorising the forest areas into 'go' and 'no-go' areas".
With the scrapping of the 'go, no-go' plan, the uncertainty has returned. There is again the possibility that miners may apply for a forest clearance only to face rejection later. And irrespective of whether 'go, no-go' exists or not, all coal blocks need an MoEF clearance if they happen to be on land owned by the forest department. The whole 'go, no-go' controversy has obscured the fact that it is these forest clearances which can take years to come through and which need to be speeded up.
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