Governments plan to restructure CIL hits road block

Written by Subhash Narayan | New Delhi | Updated: Aug 14 2014, 05:43am hrs
The governments plan for a major restructuring of Coal India by breaking up the company and converting some of the seven fuel-producing subsidiaries into independent firms has hit a road block. A high level advisory group set up by the government under the chairmanship of former power minister Suresh Prabhu has opposed major recast in the short and medium terms and instead favoured more powers to CIL subsidiaries on capital expenditure and operations to improve efficiency and enhance coal production.

The group, which is deliberating on ways to augment coal and power production in the country, may also propose to do away with the need to take forest clearance (FC) for coal exploration projects.

Sources said the group may also recommend taking out Central Mine Planning and Design Institute from CIL and attaching it with the coal ministry. CMPDI is the consultancy and mineral exploration support arm of CIL and is responsible for identifying coal blocks for mining.

The group wants CIL subsidiaries to be made more accountable so that their dependence on CIL is reduced. This, it is felt, would help in faster decision making. CIL would, however, continue to monitor their performance and give directions wherever corrective steps are required. CIL has emerged as a strong entity that does not require to be broken into smaller units to ensure efficiency and bring transparency, said a person privy to discussions.