'Earmarking of coal mines for allocations should continue'

Industry body Assocham has suggested continuation of earmarking of coal mines as done in the previous allocation to enable end-use plants which were planned on the basis of these blocks to get a fair chance to participate in the auction.
In a letter to Finance Minister Arun Jaitley, Assocham recommended that the blocks which were earlier allocated to iron and steel should be earmarked only for the same as all the end use plants (EUPs) have been established and developed based on these allocated coal blocks only.
The schedule-II blocks which have come for auction have been earmarked for iron/steel, captive power plant (CPP) and cement.

The requirement of coal in cement plants is 1/4th of that in iron and steel plant. Besides the investment is six times more for iron and steel plant and employment generation is also 10 times more in this sector compared to that in cement, it further highlighted.
The chamber said that no indicative price offer should be sought during the qualification stage and all pre-qualified bidders should be allowed to bid in the coal auction process.
"First round of technical bid should only consider technical qualifications as criteria for short-listing and it should not contain an elimination process based on financial bid i.E. The indicative price offer for coal block auction to remain transparent and competitive in order to garner maximum revenue from the procedure," the letter said.

The government on December 27 last year invited bids for 24 mines. After dropping Namchik Namphuk mine in Arunachal Pradesh from the list, 23 mines will be available in the first auction now.
The Union Cabinet had earlier approved re-promulgation of the coal ordinance and necessary guidelines for mine allocations.
The entire mine allocation process for Schedule II coal mines will be completed by March 23 with the signing of Coal Mine Development and Production Agreement, the government had said earlier.