Coal news and updates

Plan panel in favour of breaking up of CIL into several companies

January 24: The Deputy Chairman of the Planning Commission, Dr Montek Singh Ahluwalia, has advocated restructuring of Coal India Ltd by breaking it into several companies to increase competition within the PSU coal companies.

In an exclusive interview to Coal Insights, a sister publication of ICMW, Ahluwalia said, "I am in favour of breaking up CIL and making each coal company independent and compete with each other."

The recent proposal of the government for restructuring of Coal India Ltd (CIL) is a first step at making the public sector coal companies compete more aggressively with each other, Ahluwalia said.

He pointed out that actual mining operations are in any case carried out by the seven subsidiaries, which have a fairly independent board of directors empowered to take decisions on all issues.

Asked if the recent proposal of the government for restructuring of CIL is the first step towards opening up of the coal sector, Ahluwalia said, "This restructuring is not really a first step towards opening up the coal sector. That first step has already been taken in the form of captive mining and further steps require amendment of the Coal Mines (Nationalisation) Act, 1973."

"This restructuring or breaking up CIL and making each coal company independent and compete with each other could be done independent of amending the Coal Mines (Nationalisation) Act," the Deputy Chairman said, adding, "Though private sector shareholders in CIL will have to be given the option to convert their shareholding into shares of the component companies,"