Cabinet secretary KM Chandrasekhar spoke to KG Narendranath and MK Venu on the new momentum to the decision-making process, the ambitious power capacity addition programme, coal sector reforms and the recent controversy over work visas. Excerpts:

As political consensus is often elusive, the government seems to be increasingly relying on the mechanism of empowered group of ministers to unravel policy tangles where the stakes involved are high. Don?t you agree?

That is true. Notwithstanding the pulls and pressures of electoral democracy, recent years have seen remarkable achievements in policy-making, thanks to the very useful instrumentality of eGoMs. The recent eGoM resolution of the 3G spectrum dispute between the telecom companies and the defence department is the latest example of how these groups with delegated powers have not only reduced the workload of the full Cabinet, but have also been extremely productive. They have acted as sort of mini Cabinets.

EGoMs have been especially effective in disputes involving conflicting interpretations of laws and rules. As for the 3G spectrum issue, the eGoM last month approved laying down the optic fibre network worth Rs 8,000 crore for the defence services in lieu of the spectrum they would vacate. The defence department would vacate 25 Mhz of spectrum, which the department of telecommunications would then auction to the private telecom operators in the current fiscal. Basically, what the group has done is to ask both parties to stick to the original MoU. EGoMs have over the years developed a peculiar skill to iron out seemingly irreconcilable differences from the stakeholders as they deal with the policy tangles. During the previous government?s tenure, the disputes over SEZ policy was settled by an eGoM, despite strong political disaffiliations.

The last eGoM on KG basin settled the vexatious issue of who would be allocated the first 40 mmscmd of gas and also fixed the price for five years from 2007. The new eGoM is discussing the allocation policy for the extra gas output. It has the arduous task of finding the right balance when the government, the gas producer and consumers have definitive and divergent interests to protect.

EGoM prescriptions have been useful to tackle the contentious food grain policy (concerning MSP fixation, imports, etc.) despite the big fluctuations in global commodity prices in recent years which demanded more nuanced policy formulations.

We have eGoMs in many other sectors like highways, civil aviation, etc. dealing with substantive policy questions.

Many infrastructure projects have slowed down after the government crackdown on foreign workers on business visas. Thousands of expatriate workers, especially Chinese nationals engaged in execution of India?s large infrastructure projects, had to leave the country in September-October. Isn?t a policy change required?

A committee of secretaries has recently decided to introduce a new liberal dispensation for need-based issuance of employment visas. In areas where no national security angle is involved, the labour ministry will give the work permits in 4-5 days. If the ministry can’t decide within 45 days, the approval would be deemed to be given. In defence and atomic energy sectors, the home ministry will take a maximum of 15 days to decide on an application for recruiting foreign nationals.

The policy position is very clear. There isn?t any cap on skilled workers and qualified professionals from abroad. However, we have to be restrictive about unskilled foreign nationals as the country has a high incidence of unemployment. Any project promoter is free to recruit up to 20 workers or 1% of total workforce (whichever is higher) from foreign countries. Further, a committee of secretaries has now decided to allow promoters of power and steel projects to recruit up to 40 from abroad without any special permission. Even beyond these numbers, the promoters are free to absorb foreign labour provided they justify the needs for the same to the labour ministry.

However, we can?t allow foreign nationals on business visas to take up jobs here.

With large investments in power and steel industries being lined up, the demand for coal would rise manifold. Doesn?t it seem that no amount of reform, other than allowing private players in mining and free sale of coal, would help?

A slew of measures have been taken in recent months to address the shortage of coal and ensure its timely availability to key sectors. A proposal is under consideration to amend the Mines & Mineral Development and Regulation Act, which would introduce auction of coal blocks for private captive use.

A new distribution policy ensures coal allocations to meet 100% of the normative requirements of power, fertilizer and cement units. To augment supply to the SME sector, nominated state government agencies are allowed to procure coal directly from producers and supply it to units that consume up to 4,200 tonne a year. Further, the forward e-auction system introduced in August this year would benefit actual users, with assured supply for at least one year.

Since most of India?s known coal deposits are non-recoverable, it is also important to have a long-term plan to enhance supplies. Also important is to reduce the emission intensity of this predominant fuel. The government, therefore, is promoting coal gasification and liquefaction. As per the new captive mining policy, in situ and surface coal gasification projects are approved end uses. Several coal blocks have been identified for these gasification projects that would help extract deep and scattered reserves.

Besides, Coal India is looking for opportunities to invest in coal assets abroad; an empowered group of ministers would ensure speedy clearance of investment proposals of Rs 1,000 crore and above. Further reforms in this sector is also on the government?s agenda. A group of ministers set up in August this year is examining the issues concerning the proposed amendments to the Coal Mines (Nationalisation) Act 1973 (which seeks to allow private players to undertake mining and free sale of coal).

There is a concern that power generation targets for the 11th Five-Year Plan period might not be met. How valid is this fear?

The latest assessment is that the country would add 74,964 mw to its power generation capacity in the current Five Year Plan, as against the target of 78,700 mw. About 47% of the target has already been achieved. It may be noted that the capacity created during all the previous Five Year Plan periods was 56,722 mw. When it comes to actual implementation of projects, the state-sector and the private producers are doing extremely well. Perhaps, the central sector (consisting of central power utilities) are not doing as well as they should.

As for distribution reforms, there is a great deal of state government involvement and so, collective initiatives are required.

Isn?t there a need to strengthen the relations between the industry and R&D institutions?

This is an important issue. We need cheap and durable technologies to accelerate economic growth and enhance the standard of lives. I?m convening a meeting of state chief secretaries with CSIR, DRDO, etc. shortly. The idea is to expose state governments to the latest developments in the area of technology innovation. States need to be exposed to technology transfer policies. Also, their level of understanding about the dimensions of our foreign and climate change policies ought to improve. We need more initiatives like Tata?s project for affordable water purifier.