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Tuesday, October 18, 2011

Graft, Sloth Eat 25% of CIL Output: Jaiswal

Minister assures emergency measures to tackle coal shortage will prevent a dark Diwali

    Corruption, inefficiency and low productivity have eaten up at least a quarter of the output of state monopoly Coal India, putting pressure on supplies, but output is poised to rise as mines have started getting environmental clearances, Coal Minister Sriprakash Jaiswal told ET. 
Jaiswal assured power consumers that coal shortage, which has crippled many power plants, would soon be resolved as emergency measures to dispatch coal to fuel-starved power stations would build stocks and make sure there are no blackouts on Diwali. He also said the government wanted to ensure good returns for Coal India shareholders but he is also willing to contribute . 25,000 crore from the company's kitty to help fund crucial government expenditure. 
The minister's immediate concern is the coal shortage situation, which still looks wobbly. Latest data from the Central Elec
tricity Authority shows average coal stocks at 86 power projects are enough to fire the plants for only seven days as on October 16, down from eight days on October 13. The shortage, which has forced many large plants to shut down, seems unlikely to recur. Jaiswal said the scarcity was caused by an unprecedented combination of factors. Torrential rains had turned many opencast mines into vast lakes, damaged equipment, and drenched heaps of coal waiting to be transported. Also, strikes by miners and blockades by pro-Telangana agitators magnified the problem. India's coal output is poised to grow gradually as the ministry cracks the whip on rampant malpractices in state monopoly Coal India Ltd, which provides 82% of India's coal. "I do not deny inefficiency, I do not deny overstaffing. I do not deny corruption. I do not deny theft. But we are taking action against this. A chairman is in jail. There have been more CBI raids against offenders in the past 2-1/2 years than in the previous 10. Production can increase by 15% if Coal India operates in a better way and pilferage is stopped, but we need cooperation from the states," he said. Coal output can rise another 10-15% with higher productivity, which can be achieved with better staff morale, the minister said. 
Heap of Problems 

15% 
Rise in coal output possible if corruption, theft and ineffi ciency are controlled 

10-15% 
Rise in production possible if staff morale and productivity improve 

    25,000 cr 
Coal India can contribute if govt needs money for social expenditure 
Higher wage costs will be passed on to customers Coal shortage was caused by an unprecedented combination of factors 
Situation has Improved Substantially: Jaiswal 
"After the agreement with workers yesterday, the unions have assured me that they will be able to achieve 'excellent' rating for Coal India. The company will get that rating if they produce 452 million tonnes. At the current rate of production, they would produce only 440 million tonnes but we are aiming for 455 million tonnes," he said. 
"When the employee morale is good, productivity and production improve because this is a very labour-intensive industry. It can make a difference of 10-15% in production," Jaiswal said. 
The minister added that employees would also gain from a new wage agreement that is currently being negotiated. He said the company would have to pass on the higher wage costs to customers. "It is now a listed company. We have to take care of returns to shareholders." 
India's coal output has stagnated in recent years, for which Coal India blames delays in securing environment approvals, particularly after the environment ministry delineated some "no-go" areas where mining was forbidden. 
Jaiswal said the situation had improved substantially. "The go, no-go 
concept has been abandoned now. Permits would be given to projects on case-to-case basis. Procedure for environment clearances has also been eased now. The results would have started reflecting in coal supply but for the rains and strikes." 
The minister said he would not hesitate to help the government meet its social responsibilities with Coal India's cash kitty as the state-run firm's wealth really belonged to the people of India. 
"Cash-rich companies like Coal India Ltd can lend to the government whenever the government is in need of funds. For example, enactment of the food security bill would require huge funds. Coal India belongs to the people of this country and an amount of Rs 25,000 crore can easily be given to the government for implementing social schemes. We, however, have not discussed anything with the finance ministry." 
He said the government was also encouraging Coal India to acquire assets abroad, but the company had been given clear instructions that any move it makes should be strictly scrutinised to make sure there is no loss to the company and to rule out any wrongdoing. "We have asked them to tread very cautiously."

SRIPRAKASH JAISWAL, Coal Minister

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