Govt working on proposal to engage pvt cos for CIL mines

Facing criticism for its inability to meet the growing demand for coal, the government is working on a proposal under which Coal India Ltd (CIL) would engage private sector companies to undertake mining on behalf of the public sector undertaking (PSU).

The proposal to involve the private sector under the public-private partnership mode, sources said, was recently discussed between Planning Commission Deputy Chairperson Montek Singh Ahluwalia and Coal Secretary Alok Perti.

The coal ministry, they said, is considering a model agreement — mining, development and operations — under which the private sector entity would undertake mining operations, while the ownership and sale of coal would rest with CIL.

Ahluwalia, in a letter to coal minister Sriprakash Jaiswal, had recently said, "It should be possible to expand coal mining operations rapidly through a PPP model that can enable a fair and transparent framework based on competitive bidding."

CIL, in which government has a majority stake, has already done some preliminary work on the new model.

Ahluwalia wants the ministry to prepare a model concession agreement which could be put up before the inter-ministerial group and the Cabinet for approval.

CIL which accounts for over 80 per cent of the domestic coal production, missed its revised production target as it achieved only 435.84 million tonnes (MT) of coal in the financial year 2011-12 against the target of 447 MT.