The Hindu Business Line : `Coal demand-supply gap likely to widen'

In fact, the country is heading towards a severe coal shortage, which could scupper the Centre's plans to create additional thermal generation capacity, says Mr P.K. Mishra, Coal Secretary.

Delivering the valedictory address at the MGMI international conference on `Emerging challenges in mining industry' here, Mr Mishra said the coal demand-supply gap would widen from 55 million tonne (m.t.) by the end of 10th Plan (2006-07) to about 95 m.t. at the end of 11th Plan unless immediate effective steps were taken by the public and private sectors companies to augment production.

Coal production would have to be doubled in a decade or so as to meet the projected demand, and for this an investment of about Rs 3,800 crore per annum at the current price levels would be necessary during the Tenth Plan.

Since coal PSUs alone would not be able to meet this growing demand, Government has decided to offer captive coal mining blocks to entrepreneurs engaged in power generation, steel mining and cement sector for their captive use by making amendments to existing legislation. Allotment of captive blocks for setting up washeries in the private sector was also being contemplated. A total of 43 coal-mining blocks with total geological reserves of about 30 billion tonnes had been identified for captive mining. Of these, 45 blocks had been allotted so far.

Mr Mishra said the Government had decided to widen further the scope of private mining in the country and had already introduced a legislation in Parliament. On approval, the Coal Mines (Nationalisation) Amendment Bill, 2002 would allow Indian companies to engage in coal and lignite mining in new coal blocks without the existing restriction of captive consumption and would also allow companies to participate in the exploration of coal reserves in the country.

The domestic coal industry was currently at a crossroads, but was poised for substantial growth, with market forces guiding the destiny. The policy of liberalisation had created opportunities for investment in the coal sector, he said.

In order to evolve appropriate technology for effective exploration of coal and mineral resources at the lowest cost, cooperation both within the country as well as outside could be a possible solution, he said.

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