The Comptroller and Auditor General (CAG) released a Performance Audit of Allocation of Coal Blocks and Augmentation of Coal Production, on August 17, 2012.  Some of the main findings and recommendations of the report are highlighted below:

  • There were no criteria for allocating coal blocks for captive mining till 1993.  The process of bringing in transparency and objectivity began in January 2004.  However, the process has experienced delays and had yet to materialise as of February 2012.
  • In the intervening period, 194 coal blocks with geological reserves of 44,440 million tonnes were allocated to private and government parties until March 31, 2011.  The report finds that the benefit to private allottees has been estimated at Rs 1.86 lakh crore for Opencast mines.  The report states that the government could have tapped some of this financial benefit by expediting the decision on competitive bidding for allocation of coal blocks.
  • The rate of increase in production of coal by Coal India Limited (CIL) during the 11th Plan period remained below the target set by the Planning Commission.  Capacity addition projects were delayed due to the lack of coordination of government agencies involved in statutory clearances and land acquisition.  There were mismatches in excavation and transportation capacities of mines, and suboptimal use of Heavy Earth Moving Machinery.
  • The CAG recommends that Ministry of Coal (MOC) should work out modalities to implement the procedure of allocation of coal blocks for captive mining through competitive bidding.
  • The CAG recommends that the MOC should constitute an empowered group along the lines of Foreign Investment Promotion Board as a single window mechanism for granting clearances, with representatives from central nodal ministries and state governments.

A one-page summary of the main findings and recommendations can be accessed here.  The full report can be accessed on the CAG website.

(Co-authored by Sana Gangwani and Pallavi Bedi) The Standing Committee Report on the Land Acquisition and R&R Bill, 2011 was tabled in the Lok Sabha on May 17, 2012. The major changes to the Bill recommended by the Committee include:

  • Land may not be acquired for use by private companies and PPPs.
  • The role of the local governments should be expanded and made more participatory in the acquisition and R&R process. The role of Gram Sabhas should not be limited to consultation, but their consent should be obtained at different stages.
  • The Clause giving wide discretion to the government in notifying any project as infrastructure project should be deleted.
  • Threshold for R&R provisions should be fixed by the states and not the central government since sale and purchase of land is a state subject in the Constitution (Item 18, State List).
  • There should be a restriction on the acquisition of agricultural land.  The limit on the acquisition of such land should be fixed by the state governments.

For a detailed comparison of the Bill with the recommendations of the Standing Committee see here.