The Hindu Business Line : Coal comfort

Coal is one of the critical natural endowments in this country, a fossil fuel with the potential to generate much-needed energy to accelerate the wheels of industry. Admittedly, energy — in its many forms — is a critical input to fuel economic development; and rising energy shortages can retard the pace of growth. Given that so far (post-1950), only a little over 8 billion tonnes have been extracted from the country’s coalfields, of an estimated 255 bill ion tonnes of coal resources, it is but natural that attention should be focussed on beneficially exploiting the energy source in a phased manner. Without doubt, both production and consumption of coal have been growing at accelerated rates. In the Tenth Plan period, coal production increased by a compounded 5.70 per cent a year, to reach 434 million tonnes in the terminal year of the Plan period (2006-07). And yet, demand outstripped production to disclose a deficit of over 40 million tonnes. Indeed, projections for the Eleventh Plan show that the mismatch between burgeoning consumption demand and production may widen further, necessitating continued imports.

Additionally, despite our vast reserves, the techno-commercially exploitable reserves of good quality coking coal and low-ash thermal coal are scarce. Such coal needs to be imported to meet the additional surge in demand. It is the growing concern over rapidly expanding demand unmatched by indigenous supplies, and the necessity to seek expert professional services from abroad, that prompted Coal India Limited to float a global tender for private participation in development, operation and maintenance of eight coal blocks on a long-term basis. Development of coal blocks involves a gestation period of 3-5 years to reach production stage, depending on the geo-mining conditions. In unexplored blocks, it may take longer, depending on the quantum and depth of drilling.

While these parameters would obviously be considered when the contracts are finalised, a more serious issue is environmental sustainability of production. With the threat of climate change and global warming taking precedence over other pressing issues, such as food security and poverty eradication the world over, it is necessary to adopt ‘clean coal’ technologies to minimise pollution. Initiatives for co-operation in this direction with Indo-US and Indo-EU working groups and the Asia-Pacific Partnership, etc., should stand us in good stead. Infrastructure bottlenecks that stymie the supply chain and add to transaction costs need to be addressed in a co-ordinated manner — between the Railways and the coal producer, for instance. Despite being a pollutant, coal will remain the country’s primary source of commercial energy supply for years to come. For this reason alone, a time-bound plan is needed to cover the entire country by regional mapping. In addition, streamlining of procedures and processes to expedite the allotment of captive coal blocks in a transparent and effective manner brooks no delay.

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