Jharkhand CM opposes privatisation, experts decision to do away with coal washeries

The Centre’s proposal for commercialisation of coal industry to bring in investment in the country, has been opposed by the Jharkhand Chief Minister, Hemant Soren. He has objected to the Centre’s proposal to hand over 50 coal blocks to private hands, announced by the Union Finance Minister, Nirmala Sitharaman as part of the fourth tranche of financial stimulus.

The Jharkhand CM told the media that the first claimant to natural resources should be the original landowners, whose land were acquired by the government following coal nationalisation in the Seventies. He informed that the state government was studying the Centre’s proposal and will try to put forward an alternative vision in favour of the landowners.

The Jharlhand Government’s concern is prompted by fear that the Centre’s push for privatisation of coal industry might lead to job loss of thousands of labour engaged in coal mining industry in the state. Jharkhand being the largest producer of coal in the country, local inhabitants form the major part of the workforce in the coal mining sector. Attempts to privatise coal blocks will put an end to state monopoly, indiscriminate mechanization and affect employment opportunities for people living around the collieries.

Three nationalised coal companies , i.e., Central Coalfields Limited, Bharat Coking Coal Limited and Eastern Coalfields Limited – operate in Jharkhand. Whereas the former two are operative within the state, the third one operates partly in Jharkhand and partly in Bengal. Soren estimates that five million people are still engaged in coal mining activities, many of whom might be forced to migrate to other states.

The mechanism suggested by the FM has added to the disquiet. As per the statement of the FM, the commercialisation is to be done via revenue sharing mechanism instead of the current regime of fixed amounts on tonnage. Any private party can now bid for the coal blocks contrary to the existing system in which only consumers with end-use ownership, steel, power and cement plants etc., could bid.

The thinking in the State Government is to make the original land owners operate the mines and facilitate them to mobilise resources from financial institutions or allow them to choose a local working partner to collaborate.

Commercialisation of coal would also include operation of coal washeries. However, the Centre has decided to do away with mandatory coal washing before coal is transported to thermal power stations.

This too has triggered opposition from coal mining experts. A former chairman of Coal India Ltd. has described it as a retrograde step. The former CIL chairman Partha Battacharya has pointed out that washing the coal increases efficiency and quality of power stations. In a letter to the ministry and the Government of India, he urged for withdrawal of the decision to do away with coal washeries.