India to invest Rs 1.22 lakh crore in Coal sector to increase production to 1 Billion Tonnes

Targeting to increase Coal production to 1 Billion Tonnes by 2023-24, Coal India Ltd (CIL) has planned to invest  Rs
1.22 lakh crore on about 500 projects pertaining to coal evacuation, infrastructure, project development, exploration and clean coal technologies

Giving details of the investment, the Minister said out of the proposed spend of over Rs 1.22 lakh crores, CIL has planned to invest Rs 32,696 crores on Coal Evacuation, Rs 25117 crores on Mine Infrastructure, Rs 29461 crores on Project Development, Rs 32,199 on diversification & clean coal technologies, Rs 1,495 crores on social infrastructure and Rs 1,893 crores on exploration works by the year 2023-24.

Union Minister of Coal and Mines Pralhad Joshi government has aimed to increase its annual production to 1 BT (Billion Tonnes) to make India self-reliant (Aatmanirbhar) in coal production. Addressing all the stakeholders, the Minister said engagement and involvement of all concerned stakeholders in company’s affairs would reduce and uncover the project risks

“Such two-way interactions help pave way for mutually beneficial newer ideas, improvement areas and project-related expectations.” He said. The avenues for business opportunities with Coal India are huge and the company would be investing around Rs. 14,200 Crores by the year 2023-24, in two phases for its 49 First Mile Connectivity projects, he said.

The Minister further said that the first Mile Connectivity is the transportation of coal from pitheads to dispatch points and it would improve efficiency in coal transport and undertake computer-aided loading replacing the existing road transport between the two points.

Further, in a transformative plan to increase coal output and reduce import dependency of coal in the ensuing years, Coal India has identified a total of 15 greenfield projects to operate through Mine Developer and Operator (MDO) model that would entail a total investment plan of about Rs 34,600 Crores. Rs 17,000 crore would be invested by 2024, the Minister said.

Evacuation infrastructure is another major area where Coal India will be infusing large sums of money into economy. Investments in rail logistics like developing major railways (about Rs 13000 Crores) railway sidings (about Rs 3100 Crores) and procurement of own wagons (Rs 675 Crores) would total up to likely investment of over Rs 16500 Crores by FY 23-24.

The Minister said that Coal India and its subsidiaries are engaged in procurement of various types of Goods, Works and Services amounting to approximately Rs 30,000 crores per year. This is where the role and importance of stakeholder steps in. He added that Coal India in its endeavour to procure goods, works and services in fair, transparent and equitable manner has made numerous updates, changes in its Manuals and Guidelines for the benefits of vendors and stakeholders to enhance the ‘Ease of Doing Business’ and adherence to principles of transparency.

Shri Anil Kumar Jain, Secretary (Coal), Pramod Agarwal, CMD CIL and other senior officials from the Ministry of Coal and CIL attended the Meet and interacted with stakeholders. In stakeholder friendly initiatives, Coal India has relaxed an array of measures and provide exemptions for greater participation of its stakeholders in its tenders. Experience criteria have been brought down from 65% to 50% for mining tenders, while work experience criteria are relaxed by 50% in turnkey contracts.  Pre-Qualification requirement for participation in low value Works & Service Tenders have now been done away with. MSEs and Start-ups are exempted from having prior experience and turnover. There is no requirement of EMDs for MSEs and Start-ups. Make-in-India provisions have been fully integrated with all tenders.

Import of Coal

Presently we are importing more than 200 Million Metric Tonnes. Since India has a large number of coal reserves, yet it is not fully exploited. It has been increasing steadily for the past decade. While it was 217 MMT in 2014-15, it was increased to 248 MMMT in 2019-20. India is now Planninning to substantially cut it in the coming four years so as to make cut its import bill.

 As per the present Import policy, coal can be freely imported (under Open General Licence) by the consumers themselves considering their needs based on their commercial prudence.

Coking Coal is being imported by Steel Authority of India Limited (SAIL) and other Steel manufacturing units mainly to bridge the gap between the requirement and indigenous availability and to improve the quality. Coal-based power plants, cement plants, captive power plants, sponge iron plants, industrial consumers and coal traders are importing non-coking coal. Coke is imported mainly by Pig-Iron manufacturers and Iron & Steel sector consumers using a mini-blast furnace.

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