Govt moves ahead with proposal to merge Coal India arm with MECL

The government is moving ahead with a proposal to merge Coal India arm CMPDI with the Mineral Exploration and Consultancy Ltd (MECL) and will prepare a cabinet note on the same.

Central Mine Planning & Design Institute Ltd (CMPDI) is the planning and design arm of Coal India Ltd (CIL).

The mines ministry, in a letter to the CMDs of MECL and CMPDI, sought details such as profitability, turnover, current order books and current position of manpower of the companies in preparation of the merger.

The government "has approved the merger of MECL and CMPDI. In order to work out the modalities for preparation of the cabinet note, the... information may be provided to the Ministry of Mines," the official memorandum said.

The information sought also includes the authorised capital and paid up capital, details of assets, establishments and valuation, among others.

In a letter to Coal Minister Pralhad Joshi, All India Association of Coal Executives (AIACE) Principal General Secretary P K Singh Rathor welcomed the move but expressed concerns on how the merger will take place.

On the proposal to separate CMPDI from CIL, Rathor had earlier said "there will a huge problem regarding adjustment of employees and executives because both organisations have different salary structure. So, such proposal coming in mind also deserves to be discarded."

AIACE -- an association of serving and retired executives of Coal India -- had sought wider consultation over the proposal to separate the state-run firm's exploration, planning and design arm from the company.

The AIACE had earlier alleged that the proposed move to split CMPDI from Coal India is aimed at "clearing the deck" for private consultancy companies.

MECL functions under the Ministry of Mines with 100 per cent government holding, for systematic exploration of minerals.

Coal India accounts for over 80 per cent of domestic coal output.