Coal mine connectivity back on track, gets Rs 4,000-cr push

Written by fe Bureau | Kolkata | Updated: Feb 27 2013, 08:42am hrs
The coal ministry feels that the railway ministry has taken a view of expediting the process of laying tracks to connect coal mines since it has been for the first time that a railway minister has mentioned such a project in his budget speech.

Plans for coal mine connectivity projects were conceived a decade ago but the railways never took it as priority. The railway ministry has shown its seriousness about the need to evacuate additional coal and for this the plan to invest in coal mine-linking projects is important, Sriprakash Jaiswal, coal minister told Fe.

Railway minister Pawan Kumar Bansal said R4,000 crore would be invested for creating coal mine connectivity. A coal ministry official said though the project of laying tracks to connect coal mines have found a mention in the railway budget, funding for two of the three projects would be entirely done by Coal India (CIL). Funding for one project would be shared by the railways, Chattisgarh government and CIL.

Bansal in his budget speech said, The recently revamped participative policy enabling partnership with ports, large mines, industry and investors addresses the specific concerns of private investors. The model seeks to create a win-win situation by ensuring payback of investment mainly through freight appointment.

A CIL official said the three coal mine connecting projects, including Tori ShivpurKathotia (93kms) in Jharkhand, Barpali-Jharsugda- Gopalpur- Manoharpur (59kms) in Orissa and Bhupdeopur-Korba- Gevraroad- Pendraroad ( 180 kms) in Chattisgarh, would be able to get around 300 million tonnes of additional output a year.

This would make freight appointment ensure payback of investment, the official said.

A coal ministry official said the three projects has been estimated to cost R7,500 crore but the railway minister has mentioned an investment of R4,000 crore. However, it was not clear whether Bansal has talked only about the project in Chattisgarh, which was participatory in nature with RITES, CIL and Chattisgarh government funding. But the budget speech has mention of all the three projects.

While the project in Jharkhand was planned a decade ago, the projects in Orissa and Chattisgarh were planned 6 years before. But the railways should pay attention towards putting coal mines connectivity projects on fast track since it would help it generate additional revenue. Coal makes around 40% of the total freight movement, of which CIL has a 30% share, a coal ministry official said.

The railway ministry has targeted a 9% year on-year growth in its freight revenue to R93,554 crore and coal transportation has a big part.

The budget has also mentioned investments of R3,800 crore for port connectivity projects and Rs 800 crore for improving connectivity with iron ore mines.