Coal India needs restructuring to boost output: Survey

New Delhi, July 9 :

State-miner Coal India (CIL) needs to be restructured quickly to raise output and ease the fuel supply situation, the finance ministry said in its annual Economic Survey.
“The process of restructuring CIL needs to be pushed through swiftly to boost coal production,” said the 2013-14 Survey presented by Finance Minister Arun Jaitley to parliament Wednesday.

CIL accounts for about 82 percent of India’s coal production, which during 2013-14 was 566 million tonnes and fell short of much higher demand levels.

The government should also allow commercial mining by private companies, said the ministry’s report.

“Since mining involves huge sunk cost, the government should allow only a limited number of large domestic companies with proven track record to compete with CIL and also to bring in the latest technology and skills,” the Survey said.

Consultancy firm Deloitte, which had been selected to study the restructuring of CIL, had earlier this year submitted its draft report to the coal ministry.

The Planning Commission and other high-level panels such as the Expert Committee on Road Map for Coal Sector Reforms, also known as the T.L. Shankar Committee, had recommended restructuring CIL in view of the rapidly increasing demand for coal and the need to enhance production and make the sector competitive.


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