Today, major national
parties shying away from constructive debate in Parliament is an
extremely unfortunate and dangerous development. I would like to
reiterate, that every issue that confronts the nation can be discussed
constructively on the floor of parliament. People of India expect their
representatives to debate rather than stall the proceedings. It is an
affront to the sensitivies and expectations of the people. Not agreeing
to debate the issue and stalling the Parliament process is also a
contempt of the highest institution of democracy.
Debate on CAG report
The CAG report on coal block allocations etc, under the procedure
itself is inactionable. It is an established constitutional convention
that the CAG report has to be validated by the Public Accounts Committee
andthereafter it is presented before Parliament.
However, we have offered to discuss the CAG report in itself in
Parliament, because the government has nothing whatsoever to hide. The
campaign orchestrated against PM is a motivated attempt to weaken the
moral and political authority of the centre. We will be compelled to
take the debate to the people’s court through whatever means are
available to us, in case we are prevented from doing so on the floor of
The procedure for allotment of coal mines,
From 1993 to 2004, the policy of allotment through the Screening
Committee was in vogue. In 2004, the Government issued instructions
through advertisement detailing the terms and conditions and eligibility
criteria for allotment of coal mines. The reason for making this
information public was to aid any of the aggrieved parties to seek
redressal, if the allotments were not made as per guidelines.
Coal blocks auctioning
The question being asked now is why no auctioning?
In 2004, the UPA government mooted a proposal to change the method of
allotment through competitive bidding. But, we had to consult the state
governments as well. The governments of West Bengal, Chhattisgarh and
Rajasthan did not favour the auctioning method. The then Rajasthan CM
Ms. Vasundhara Raje Scindia, wrote to PM not to change the allotment
criteria, reasoning that the state government will not have any role if
the mines get allotted to outside parties and they bring not benefits to
The Government then sought the legal opinion. The fist opinion asked the
government to amend the legislative framework. When the state
government’s opposed the proposal, the second opinion from the Law
Ministry said the law can be amended by an Executive Order. The
divergence of opinion compelled the government to consult the Law
Ministry again, and it was advised that to change the procedure of
allotment the Act has to be amended.
In 2008 the draft bill was formulated, which went to the Standing
Committee. In 2010, the Standing Committee asked to go back and talk to
the state governments. All this process took time. The delay was neither
deliberate not intentional. It was intended to put the law on a sound
footing, arrived at through widespread consultations. .
Presumptive calculation of loss
CAG’s calculation of loss are presumptive. Anyone who knows anything
about geology will understand that there is no such thing as a average
price and average reserves. The mines vary in their coal reserves and
even the cost of extraction varies from mine to mine. Therefore,
multiplying the average reserves with average cost plus selling price
and arriving it a figure is totally flawed.
Further, out of 57 allotments only one allottee has been able to mine
the coal. There is been no mining in 56 coal blocks for a variety of
reasons, including not getting environmental clearance etc. The coal is
where it is. The government has already denotified 25 mines. 32
allottees have been cautioned against non action. If the coals are not
mined, they will come back to government. Where is the loss?
There is also no exercise of arbitrary power. Because all the allotments
have been made on the recommendations of the Screening Committee, in
which all the concerned state governments were represented through their
Coal was required to
increase power production, steel production, and to boost cement
production. It was necessary to allocate coal mines to supplement the
supply of coal from Coal India ltd. India’s 8 per cent growth did not
come out of nothing. In the 10th plan period, total addition to capacity
of power was 8575 Mw. In the 11th Plan it was 42,000 Mw, a five fold
increase. This was possible because government tried to maximise natural
That is the way to look at opportunity cost.