Our Bureau

New Delhi, Nov 18

THE Cabinet Committee on Economic Affairs (CCEA) has approved foreclosure report for Jhanjra underground project of Eastern Coalfields.

Briefing reporters after a meeting of the CCEA, the Finance Minister, Mr P. Chidambaram, said the foreclosure was approved due to decline in returns and labour productivity.

"The Labour productivity declined from 3.05 tonnes to 1.46 tonnes. The internal Return on Investment (RoI) also declined from 11.12 per cent to 6.02 per cent. This was due to poor financial planning and problem of land acquisition. Therefore CCEA has approved proposal of Ministry of Coal to foreclose the project," he pointed out.

The Jhanjra underground project is located in the North Eastern side of Raniganj Coalfield, Burdwan in West Bengal. The project was earlier approved with a production capacity of two million tonnes per year and had a capital cost of Rs 363.07 crore.

The project has produced 1.03 million tonnes per annum of Grade `C' coal.

Meanwhile the CCEA has deferred a proposal to allow state-run Oil PSUs - Indian Oil Corporation, Oil and Natural Gas Corporationand Gas Authority of India Ltd to sell their cross holdings.

The proposal was deferred as the concerned minister (the Minister of Petroleum and Natural Gas, Mr Mani Shankar Aiyar) was not present during the Cabinet meeting.

On the proposal relating to National Urban Renewal Mission, Mr Chidambaram said, "There is no decision that has been taken today, which can be announced."

(This article was published in the Business Line print edition dated November 19, 2005)
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