24/07/2020 - Government Policies

KEY POINTS

·         The government’s decision to open the coal sector for private sector will bring investment opportunities for the private sector, competition and efficiency gains.

·         With nationalised coal mines failing to meet our demand, commercial coal mining is the only panacea for India to get rid of coal imports, achieve energy security and reduce import bill.

·         There are many examples of responsible mining in India such as Hindustan Zinc, which has brought immense benefit to the local population while ensuring that the local life and traditions of the tribal community remain unperturbed.

·         The district mineral fund and corporate social responsibility funds are invested in the local communities and have the potential to facelift the human and physical infrastructure in these areas.

·         The revenues of states are bound to receive a substantial jump when commercial mining starts in these states. This will give a major impetus to national and state revenues.

·         Mining is a labour-intensive sector, which would mean that such mines will employ thousands of people, their families will live close by, and a supporting coal transport infrastructure will need to be developed, including rail junctions.

·         Entry of private sector in the coal sector has immense forward and backward linkages. The backward linkage of transportation and physical infrastructure is bound to create clusters of growth.

·         Sixth, for many, the blanket objection is the adverse impact on the environment. They should realise that India continues to import coal. At least when we are mining coal within the country, we can take all the necessary precautions.

·         In fact, the use of coal in power generation will help us balance the energy grid, which in turn will help us leverage the renewable energy capacity that is expected to cross 100 GW. Besides, as per the World Resources Institute, globally the average CO2 emission per capita is 4.8 tonnes, whereas for India the number stands at two tonnes per capita.

·         The socio-economic benefits of opening the coal sector for commercial mining are enormous. This move will revitalise the coal sector in the same way as the entry of private players changed the face of Indian banking. We are undoing the damage done to India and its economy five decades back.

The govt recently announced the privatisation of the coal sector —as part of the  “Atma Nirbhar Bharat Abhiyan”, which, will act as a booster shot for India as the nation battles the Covid-19 pandemic and the resultant economic crisis.

The coal sector is an important pillar of India's economy, having a fourth largest reserves of coal in the country, but still it is importing dry fuel. In pursuit of "Self-reliant campaign", India is moving towards bringing coal imports down to zero and has set an ambitious target of producing one billion tonnes of coal annually by 2023-24.

>>> Significance of privatisation of coal sector in transformation of India’s growth trajectory :

- will  marks the beginning of unlocking of the country's coal sector from the lockdown of decades, and aims at making India the largest exporter of coal, thus, saving valuable forex.

- will bring efficiency and lead to competitive pricing of the dry fuel because one reason why imports have been rising regularly in the last 5-6 years is non-competitive pricing of coal in the country.

- With the private sector, there will be lowering of prices of fossil fuel, which may lead to either completely stop coal imports or drastically reduce India’s 80 per cent import dependency on coking coal for steel.

- Launching the auction of mines for commercial mining, is expected to garner Rs 33,000 crore of capital investment in the country over next 5-7 years.

- This auction process is likely to contribute Rs 20,000 crore revenue annually to state govts because commercial mining will be done on revenue sharing mechanism instead of fixed rupee/tonne.

- will also create employment opportunities for tribal communities and local populations besides developing the far-flung areas.

- Entry of private sector in the coal sector has immense forward and backward linkages. The backward linkage of transportation and physical infrastructure is bound to create clusters of growth. In forward linkage, sectors such as cement, fertilisers, steel, and aluminium will bolster tremendous growth.

>>> Way Forward :

- Encouraging coal gasification is the way forward in judiciously using our coal resources in an environment-friendly manner.

- Mining is a labour-intensive sector, thus, a supporting coal transport infrastructure will need to be developed, including rail junctions.

>>> Conclusion :

These many reforms will help India to achieve energy security as well as realise the $ 5 trillion economy vision if implemented well.

Pls review

Pls Review Sir 

sir please review

thank you