Government defends policies on coal, airport and power

The gobvernment today defended its policies on the allocation of coal blocks to private and other parties as also the concessions given to the Delhi airport operator and its policy of farming out ultra mega power projects

The allocation of coal blocks for captive use commenced in 1993 after the amendment in the Coal Mines (Nationalisation) Act, 1973. Between 1993 and June 2004, 39 coal blocks were allocated. Initially there was not much demand for such allocation and the applicants themselves used to identity coal blocks and apply for allocation.

Later on due to increase in number of applications and to ensure consistency, a consolidated set of guidelines was evolved in November 2003. In order to further improve upon the system and to bring in transparency it was decided in September 2005 that the government would invite applications through advertisement in important national and regional newspapers, which would provide opportunity to all eligible applicants to apply.

The procedure adopted for allocation involved wide consultations with all stakeholders. Comprehensive details about the applicant, the group, performance of the group, financial strength, readiness of the end-use plant etc were placed before the committee so as to enable it to make appropriate recommendation keeping in mind the comparative merits of the applicants.

The Screening Committee assessed the applications having regard to the matters such as techno-economic feasibility of the end use project, status of preparedness to set up the end use project, past track record in execution of projects, financial and technical capabilities of the applicant companies, recommendations of the state governments and the administrative ministry concerned.

Therefore, to hold that the process of allocation was not transparent does not appear to be based on appreciation of the process of allocation that was put in place in the prevalent circumstances. The subsequent move to introduce competitive bidding is to make the selection process more objective and demonstrably transparent.