Coal India Ltd (CIL) has been asked to liquidate coal stocks of up to 28 million tonnes (mt) lying at pit heads during the current fiscal for augmenting supplies to the power sector.

With this, the gap between demand and supply is expected to come down to 114 mt, from an earlier estimate of 142 mt for 2011-12, the Coal Minister, Mr Sriprakash Jaiswal, said at an industry conference here on Wednesday.

He, however, made it clear that stock liquidation by Coal India was subject to the availability of rail rakes and in case transportation infrastructure is not available, the power sector will have to make its own arrangements.

"... Liquidation is subject to the availability of rakes and if the same is not feasible, the power sector needs to arrange evacuation of coal from pitheads of their own," Mr Jaiswal said.

The Government has asked CIL to liquidate stocks lying at pitheads to the maximum extent possible and the coal major's chief, Mr N.C. Jha, has been asked to personally monitor the situation. As of April 1, approximately 70 mt of coal was lying at the pithead of various mines owned by CIL and its subsidiaries.

CIL had attributed the accumulation of pithead stocks to law and order problems in States such as Jharkhand and Orissa, constraints in transportation of coal from pitheads to railway sidings and lower availability of railway rakes in the third and fourth quarter last fiscal.

On the widening demand-supply deficit, Mr Jaiswal said it shot up from about 50 mt in 2007-08 to 83 mt last fiscal. Coal demand in the current fiscal stands at 696 mt, against the targeted production of 554 mt, he said.

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