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  1. Lok Sabha passes Coal Bill to allow e-auction of coal blocks; replaces Ordinance

Lok Sabha passes Coal Bill to allow e-auction of coal blocks; replaces Ordinance

Coal Mines bill passed in Lok Sabha amid opposition by Left and some Opposition parties.

By: | Published: March 4, 2015 5:01 PM
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Coal and Power Minister Piyush Goyal says passage of Coal Mines Bill would ensure ‘transparent and honest’ process of auctioning of coal blocks. (Reuters)

Lok Sabha today passed the Coal Mines bill to allow e-auction of coal blocks after the Supreme Court cancelled their allocation leading to uncertainty in the coal sector, amid opposition by Left and some other opposition parties.

The Coal Mines (Special Provisions) Bill, 2015, would replace two ordinances issued by the government — the first on October 21 last year and the other in December, after the apex court cancelled the allocation of 204 blocks.

Replying to a debate on the bill, Coal and Power Minister Piyush Goyal said its passage would ensure “transparent and honest” process of auctioning of coal blocks.

Highlighting the necessity of passing the bill, he warned that if the Bill is not passed, then there could be a crisis in the coal sector with the closure of these mines.

Goyal maintained that all power plants had adequate coal reserves and the e-auction has ensured open bidding and no monopoly in the process.

The bill was passed by a voice vote after the House voted out amendments moved by opposition members. While some of the amendments were disapproved by voice vote, CPI(M) member Badruddoza Khan’s amendments were voted out after a division sought by him.

Earlier, the Minister asserted that adequate safeguards have been put in place to ensure the end-use restrictions and stop hoarding.

Goyal said not even a single coal block was auctioned during the UPA’s 10-year rule, and the NDA government has already started auctioning the blocks so that the country gets uninterrupted power supply.

“Even after so many years of independence, 30 crore people do not have access to electricity,” he said, adding that a technical copmmittee has decided on which block to be auctioned to which sector.

The Bill provides for allocation of coal mines and vesting of the right, title and interest in and over the land and mine infrastructure together with mining leases to successful bidders and allottes through a transparent bidding process.

The coal blocks are now being allocated in line with the provisions of the ordinances and rules made under them and the auction of these blocks were being carried out through an e-auction process to transparency of the process.

The main purpose of the ordinances, which are now being replaced by the bill, was to overcome acute shortage of coal in core sectors and ensure energy security. They facilitated allocation of coal mines to steel, cement and power utilities which are vital for development, Goyal said.

Giving the rationale for bringing the Ordinances, he said pursuant to Supreme Court cancelling the blocks, mining had stopped and coal output had hit a low.

“Economic activity would have been impacted. It was very essential that the Ordinances be brought so that coal production continues,” he said.

Assuring states that their interests would be taken care of, Goyal said upfront fees as well as their share in royalty payment would go to the states.

“We would not discriminate among states on political lines… I am socialising coal block allocation so that every state gets their share in a fair manner,” he said.

Goyal said the NDA government is committed to “affordable power and full power” to citizens of the country.

As regards workers agitation in Tamil Nadu-based Neyveli Lignite, Goyal said he would soon visit the plant and have a discussion with the employees and work towards solving their problems.

He also assured the House that since he holds dual charge, he would not favour power companies and leave out the rest in coal auctioning, although “electricity will have to be given more priority”.

Participating in the debate on the bill, a Congress member found fault with the government’s plan to let states having coal blocks alone to have the lion’s share of revenue generated by the their auction and demanded other states should also be given a slice of the cake.

Dipender Hooda said coal is a national asset and the Constitution makers put it on central list because they wanted all states to pitch for developing the sector and share the profit or loss.

Hooda said all states put together their money for development of coal mines over decades and if it is now generating some money then they should also get a share of the profit as they shared the loss earlier.

He wondered if food grain-rich states like Punjab and Haryana, a state from which he comes, will be allowed to auction their produce like coal.

Over 95 percent of coal is produced by five states and they, under the new law brought by an ordinance which the bill seeks to replace, would pocket the windfall brought by its auction, Hooda said.

Hooda also warned the government to be watchful of the danger of monopoly which he said was a likely pitfall of the auction route.

He also attacked other parties for targeting Congress over the Supreme Court judgment that quashed coal block allocation under its 10 year rule, saying the order covered allotments made over 20 years between 1993 and 2013. NDA and other non-Congress parties were in power for eight years.

Dushyant Chautala (INLD) lauded the government over some of the provisions of the bill.

Arun Kumar (RLSP) and Jagdambika Pal (BJP) also spoke and attacked Congress over scams in the coal sector during the UPA rule and said the new law will end it.

Ganesh Singh and Uday Pratap Singh (both BJP)and Sher Singh Ghubaya (SAD) were critical of the erstwhile UPA dispensation alleging that its failure to take effective steps in the allocation of coal blocks had cost the country dear.

Kalyan Banerjee (TMC) said the Parliamentary Standing Committee headed by him in the last Lok Sabha was the first to speak about the irregularities in the coal blocks allocation.

The government has already auctioned 19 mines in the first lot, it came out with the list of successful bidders for just 15 mines. The rest four mines are being re-examined by the Nominated Authority as there were some issues including pricing of the bids.

The e-auction proceeds from the first lot of mines are over Rs one lakh crore. Auctioning of second lot of mines is also in the process. PTI JD KR SPG ARC 03041640

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