Cabinet nod sought for Coal Videsh

New Delhi, March 23 | Updated: Mar 24 2006, 05:30am hrs
After a long delay, decks have now been cleared for setting up the Coal Videsh Limited (CVL), the overseas arm of public sector coal behemoth Coal India Limited. The coal ministry proposes to send a final note for consideration to the Cabinet late next month.

We have circulated notes to ministries concerned on the issue of CVL and are awaiting their views. As and when their views come, we shall be putting the same before the Cabinet for its approval, coal secretary HC Gupta told reporters here adding that the process was expected to be completed in three to four weeks time.

When pointed out that the finance ministry had some reservations, Mr Gupta said nothing has been conveyed to his ministry and so there was no point in commenting about it.

CVL has been mandated to scout for coal mines in countries like Australia, Mozambique and Uganda. So far no deals have been struck.

Earlier, addressing mediapersons about the report of Shankar Commitee on coal sector reforms, coal minister Shibu Soren said the thrust has been on measures to increase coal production to meet the growing demand.

The first part of the report, which has been submitted to the ministry has suggested setting up of a permanent task force to monitor progress, clearances and project implementation of all projects to be competed by the end of the 11th Plan period. It has also recommended faster clearances of projects for coal mining for captive usage with penal provisions for non utilisation of alloted blocks within a specified period of time.

The committee has also recommended the creation of a revolving fund of Rs 500 crore for bringing coal reserves in inferred category to proven category.

It has also suggested a differential pricing mechanism for coal where the power sector gets coal at a special (lower) price while other consumers get 60% of their requirement at coal price indexed through e-auction route and rest through imports.

For this to take shape, the commitee has also suggested increasing the quantity of coal to be sold under the e-auction route from domestic sources. It has also suggested replacing the present system of coal linkages with long-term fuel supply agreements.