The prevailing laws on coal mining necessitate that the public sector have the controlling stake in coal mining joint ventures. The management control carrot was dangled to potential investors on the assumption that demand projections for coal required investments that were beyond the resources available with the public sector Coal India Limited and its eight subsidiaries.

Union minister of state for mines and minerals Rita Verma said, ``The public sector coal industry will continue to play a dominant role even in future but there is so much of space available that the private sector will not elbow the public sector out.'' She pointed out that 100 coal blocks were available for the private sector for captive coal mining.

Boparai said, private sector investors in joint venturewith subsidiaries of the Coal India Limited ``may be allowed to have management of mines with them'' even if they had only 49 per cent equity.

He said management control may be offered to private sector investors on ``condition that in the event of amendment in the existing laws, such private equity will be enhanced by two per cent to become 51 per cent.''The coal secretary felt that such joint ventures could be used to attract private investment in both greenfield mining projects and existing mines.

The share of the Coal India subsidiaries in the joint ventures would be in the way of assets already created in the mines or by additional infusion of equity.

The joint ventures could help the profit centres among the coal companies segregate themselves from loss-making companies, to be able to mobilise resources for new projects and development of old mines. He pointed out that even the truncated coal demand projections for the Ninth and Tenth Plans could not be met with the existing resources and withoutinvestment from the private sector.

He said the demand for coal at the end of the Tenth Plan would not be as high as the 650 million tonne projected by the working group on coal and lignite in 1996. It would, however, still be higher than the availability of coal in the country.

By the end of the 10th Plan, the shortfall in the availability of coal was likely to be 40 million tonne if the demand ranged between 445 million tonne and 600 million tonne, Boparai said.