Panel seeks views on e-auction, coal distribution by Jan 29

Mumbai, Jan 19 | Updated: Jan 20 2007, 06:54am hrs
Notwithstanding the opposition by coal merchants, the Centre has formed a committee headed by the coal secretary to evolve a viable policy for coal distribution. The Centre has resorted to this move after the order delivered by the apex court directing streamlining of the e-auction for coal.

The committee has sought suggestions and objections by January 29. At present Coal India is the major supplier of coal to various consumers located in the country, both in core and non core sector.

Sources told FE that the Centre was of the view that the introduction of e-auctioning of coal would certainly help reduce the scope of black-marketeering. However, what is crucial is that it would give a benchmark of the price of coal. However, coal merchants have pleaded that CIL, as a monopoly producer, could not enjoy the luxury to e-auction coal by discarding the age-old system of coal linkages, facilitating consumers to get coal of the right type and at the right price.

The committee would review the existing classification of consumers into core and non core sectors, suggest a mechanism for supply of coal to consumers in different sectors. This apart, the committee would also recommend mechanism for coal supply to small/tiny consumers who are unable to access coal directly from coal companies. The committee would also suggest strategies to bring about transparency in coal distribution by use of modern technologies including information technology.

During the current fiscal 32 million tonne of coal had been earmarked for e-auction of which about 15 MT has been distributed. Under the new system coal hitherto earmarked for e-auction would now be offered on e-bidding to consumers and traders and the price has been fixed at 30% more than the notified price.

It must be mentioned here that the Parliamentary standing committee on coal and steel had observed that the sale of coal to non core sector through e-auction has not yielded the desired results. The small and medium consumers, if at all, they succeed in getting supply through e-auction are bound to get the same at higher price.