Coal news and updates

New Delhi's draft rules for allotting coal blocks have a large loophole that could allow state governments to use their discretionary powers to defeat the purpose of making the dry fuel available transparently and without corruption, according to executives at several infrastructure companies. 

 

These executives welcomed the ordinance to auction mining licences revoked by the Supreme Court and issue of the draft guidelines, but also sought standard rules for states to follow when they outsource mining work through mining development operation (MDO) contracts. The draft does not address this issue and the absence of common regulation could lead to irregularities in the allotment of MDO and washery contracts by states. The Centre had allotted more than 100 coal blocks to various state government-owned entities through the so-called dispensation route. Development of many of such blocks was awarded by the state governments to private entities under MDO contracts. 

 

Some of these blocks were among the 218 for which the Supreme Court cancelled mining licences, terming the entire allocation process "illegal". According to it, "the allocation through the government dispensation route suffers from the vice of arbitrariness and legal flaws." Most of the coal blocks allotted through the dispensation route were in Chhattisgarh, Jharkhand, Madhya Pradesh, Orissa, West Bengal and Andhra Pradesh. Dozens of blocks allotted through the dispensation route suffered from irregularities, but no enquiry was ordered till date, said the chairman of an infrastructure firm whose coal block allocation was among those found illegal by the court.

 

 

Source: ET