Concerned over the contraction in mining output as reflected in the second-quarter GDP data and particularly the stagnation in coal production, the Prime Minister?s Office (PMO) has decided to set up a mechanism for direct monitoring of coal projects and impediments to their fruition.
A group of senior officials from the ministries of coal, environment, power and railways and the Planning Commission, headed by Cabinet secretary Ajit Kumar Seth, will regularly track progress of coal projects, ensure that their implementation is on the fast track and that delays don?t worsen the country?s power shortage. The PMO said the group will also monitor transportation of coal at the state level, as bottlenecks on this front are seen as worsening the shortage at power stations.
The officials will regularly visit coal-bearing regions in states and address issues on environment, land acquisition and rehabilitation & resettlement, sources said. The group will be empowered to fast-track issuance of no-objection certificates (NoC) under the provisions of the Forest Rights Act and forest and environmental clearances.
?There is total disconnect between central and state-level agencies giving clearances for coal projects. The group will act as a link between the Centre and states and ensure that communication channels are opened at all times so that the project approval process is hastened,? said a government official familiar with the development.
Poor transport disrupts supplies and affects overall production of coal, the main fuel source for power, steel and cement companies.
Mines such as Kaniha, Basundhara and Kulda under Mahanadi Coalfields (MCL) have not been able to transport coal to power plants located nearby due to scarcity of railway rakes. The PMO has directed officials to work out a definite coal evacuation plan for these mines to start with.
The PMO has asked the environment ministry to expedite Stage-II of forest clearance for pending projects and take an immediate view on 17 projects currently on hold on account of the Comprehensive Environmental Pollution Index (CEPI). The coal ministry has been told to identify mines where production can be quickly enhanced up to limits approved by the environment ministry.
The government is concerned that environment and land acquisition would derail progress on several key infrastructure projects, which as per Plan panel’s projections, would require over $1 trillion in the 12th Five year Plan (2012-17). Already, the environment ministry’s go-no-go norm has delayed projects and despite the recent resolution of the issue, many projects are yet to take off.
With an estimated production of 554 mt, the demand-supply gap in coal is likely to touch 142 mt this financial year. The Planning Commission has projected that supply would fall short by 200 mt a year in the 12th Five Year Plan, when annual production would average at the same level as this year.
Reflecting the situation, Coal India which produces around 81% of all coal produced in the country, has requested the coal ministry to lower its annual target from 448 mt from 452 mt.
The Planning Commission has proposed that even captive coal block holders should be allowed commercial sales, in an attempt to boost supplies. The coal ministry is not convinced, saying it would confer undue benefits on private companies.
