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Earlier this week, Lok Sabha passed the Bill that provides for the allocation of coal mines that were cancelled by the Supreme Court last year. In light of this development, this post looks at the issues surrounding coal block allocations and what the 2015 Bill seeks to achieve.
In September 2014, the Supreme Court cancelled the allocations of 204 coal blocks. Following the Supreme Court judgement, in October 2014, the government promulgated the Coal Mines (Special Provisions) Ordinance, 2014 for the allocation of the cancelled coal mines. The Ordinance, which was replaced by the Coal Mines (Special Provisions) Bill, 2014, could not be passed by Parliament in the last winter session, and lapsed. The government then promulgated the Coal Mines (Special Provisions) Second Ordinance, 2014 on December 26, 2014. The Coal Mines (Special Provisions) Bill, 2015 replaces the second Ordinance and was passed by Lok Sabha on March 4, 2015. Why is coal considered relevant? Coal mining in India has primarily been driven by the need for energy domestically. About 55% of the current commercial energy use is met by coal. The power sector is the major consumer of coal, using about 80% of domestically produced coal. As of April 1, 2014, India is estimated to have a cumulative total of 301.56 billion tonnes of coal reserves up to a depth of 1200 meters. Coal deposits are mainly located in Jharkhand, Odisha, Chhattisgarh, West Bengal, Madhya Pradesh, Andhra Pradesh and Maharashtra. How is coal regulated? The Ministry of Coal has the overall responsibility of managing coal reserves in the country. Coal India Limited, established in 1975, is a public sector undertaking, which looks at the production and marketing of coal in India. Currently, the sector is regulated by the ministry’s Coal Controller’s Organization. The Coal Mines (Nationalisation) Act, 1973 (CMN Act) is the primary legislation determining the eligibility for coal mining in India. The CMN Act allows private Indian companies to mine coal only for captive use. Captive mining is the coal mined for a specific end-use by the mine owner, but not for open sale in the market. End-uses currently allowed under the CMN Act include iron and steel production, generation of power, cement production and coal washing. The central government may notify additional end-uses. How were coal blocks allocated so far? Till 1993, there were no specific criteria for the allocation of captive coal blocks. Captive mining for coal was allowed in 1993 by amendments to the CMN Act. In 1993, a Screening Committee was set up by the Ministry of Coal to provide recommendations on allocations for captive coal mines. All allocations to private companies were made through the Screening Committee. For government companies, allocations for captive mining were made directly by the ministry. Certain coal blocks were allocated by the Ministry of Power for Ultra Mega Power Projects (UMPP) through tariff based competitive bidding (bidding for coal based on the tariff at which power is sold). Between 1993 and 2011, 218 coal blocks were allocated to both public and private companies under the CMN Act. What did the 2014 Supreme Court judgement do? In August 2012, the Comptroller and Auditor General of India released a report on the coal block allocations. CAG recommended that the allocation process should be made more transparent and objective, and done through competitive bidding. Following this report, in September 2012, a Public Interest Litigation matter was filed in the Supreme Court against the coal block allocations. The petition sought to cancel the allotment of the coal blocks in public interest on grounds that it was arbitrary, illegal and unconstitutional. In September 2014, the Supreme Court declared all allocations of coal blocks, made through the Screening Committee and through Government Dispensation route since 1993, as illegal. It cancelled the allocation of 204 out of 218 coal blocks. The allocations were deemed illegal on the grounds that: (i) the allocation procedure followed by the Screening Committee was arbitrary, and (ii) no objective criterion was used to determine the selection of companies. Further, the allocation procedure was held to be impermissible under the CMN Act. Among the 218 coal blocks, 40 were under production and six were ready to start production. Of the 40 blocks under production, 37 were cancelled and of the six ready to produce blocks, five were cancelled. However, the allocation to Ultra Mega Power Projects, which was done via competitive bidding for lowest tariffs, was not declared illegal. What does the 2015 Bill seek to do? Following the cancellation of the coal blocks, concerns were raised about further shortage in the supply of coal, resulting in more power supply disruptions. The 2015 Bill primarily seeks to allocate the coal mines that were declared illegal by the Supreme Court. It provides details for the auction process, compensation for the prior allottees, the process for transfer of mines and details of authorities that would conduct the auction. In December 2014, the ministry notified the Coal Mines (Special Provisions) Rules, 2014. The Rules provide further guidelines in relation to the eligibility and compensation for prior allottees. How is the allocation of coal blocks to be carried out through the 2015 Bill? The Bill creates three categories of mines, Schedule I, II and III. Schedule I consists of all the 204 mines that were cancelled by the Supreme Court. Of these mines, Schedule II consists of all the 42 mines that are under production and Schedule III consists of 32 mines that have a specified end-use such as power, iron and steel, cement and coal washing. Schedule I mines can be allocated by way of either public auction or allocation. For the public auction route any government, private or joint venture company can bid for the coal blocks. They can use the coal mined from these blocks for their own consumption, sale or for any other purpose as specified in their mining lease. The government may also choose to allot Schedule I mines to any government company or any company that was awarded a power plant project through competitive bidding. In such a case, a government company can use the coal mined for own consumption or sale. However, the Bill does not provide clarity on the purpose for which private companies can use the coal. Schedule II and III mines are to be allocated by way of public auction, and the auctions have to be completed by March 31, 2015. Any government company, private company or a joint venture with a specified end-use is eligible to bid for these mines. In addition, the Bill also provides details on authorities that would conduct the auction and allotment and the compensation for prior allottees. Prior allottees are not eligible to participate in the auction process if: (i) they have not paid the additional levy imposed by the Supreme Court; or (ii) if they are convicted of an offence related to coal block allocation and sentenced to imprisonment of more than three years. What are some of the issues to consider in the 2015 Bill? One of the major policy shifts the 2015 Bill seeks to achieve is to enable private companies to mine coal in the future, in order to improve the supply of coal in the market. Currently, the coal sector is regulated by the Coal Controller’s Organization, which is under the Ministry of Coal. The Bill does not establish an independent regulator to ensure a level playing field for both private and government companies bidding for auction of mines to conduct coal mining operations. In the past, when other sectors have opened up to the private sector, an independent regulatory body has been established beforehand. For example, the Telecom Regulatory Authority of India, an independent regulatory body, was established when the telecom sector was opened up for private service providers. The Bill also does not specify any guidelines on the monitoring of mining activities by the new allottees. While the Bill provides broad details of the process of auction and allotment, the actual results with regards to money coming in to the states, will depend more on specific details, such as the tender documents and floor price. It is also to be seen whether the new allotment process ensures equitable distribution of coal blocks among the companies and creates a fair, level-playing field for them. In the past, the functioning of coal mines has been delayed due to delays in land acquisition and environmental clearances. This Bill does not address these issues. The auctioning of coal blocks resulting in improving the supply of coal, and in turn addressing the problem of power shortage in the country, will also depend on the efficient functioning of the mines, in addition to factors such as transparent allocations.
The National Education Policy (NEP) 2020 was released on July 30, 2020. It will replace the National Policy on Education, 1986. Key recommendations of the NEP include: (i) redesigning the structure of school curriculum to incorporate early childhood care and education, (ii) curtailing dropouts for ensuring universal access to education, (iii) increasing gross enrolment in higher education to 50% by 2035, and (iv) improving research in higher education institutes by setting up a Research Foundation. In this blog, we examine the current status of education in the country in view of some of these recommendations made by the NEP.
Universal access to Education
The NEP states that the Right to Education Act, 2009 has been successful in achieving near universal enrolment in elementary education, however retaining children remains a challenge for the schooling system. As of 2015-16, Gross Enrolment Ratio was 56.2% at senior secondary level as compared to 99.2% at primary level. GER denotes enrolment as a percent of the population of corresponding age group. Further, it noted that the decline in GER is higher for certain socio-economically disadvantaged groups, based on: (i) gender identities (female, transgender persons), (ii) socio-cultural identities (scheduled castes, scheduled tribes), (iii) geographical identities (students from small villages and small towns), (iv) socio-economic identities (migrant communities and low income households), and (v) disabilities. In the table below, we detail the GER in school education across: (i) gender, and (ii) socio-cultural identities.
Table 1: GER in school education for different gender and social groups (2015-16)
|
Level |
Male |
Female |
SC |
ST |
All |
|
Primary (I-V) |
97.9% |
100.7% |
110.9% |
106.7% |
99.2% |
|
Upper Primary (VI-VIII) |
88.7% |
97.6% |
102.4% |
96.7% |
92.8% |
|
Secondary (IX-X) |
79.2% |
81% |
85.3% |
74.5% |
80% |
|
Senior Secondary (XI-XII) |
56% |
56.4% |
56.8% |
43.1% |
56.2% |
Sources: Educational Statistics at Glance 2018, MHRD; PRS.
Data for all groups indicates decline in GER as we move from primary to senior secondary for all groups. This decline is particularly high in case of Scheduled Tribes. Further, we analyse the reason for dropping out from school education. Data suggests that the most prominent reason for dropping out was: engagement in domestic activities (for girls) and engagement in economic activities (for boys).
Table 2: Major reasons for dropping out (Class 1-12) for 2015-16
|
Reason for dropping out |
Male |
Female |
|
Child not interested in studies |
23.8% |
15.6% |
|
Financial Constraints |
23.7% |
15.2% |
|
Engage in Domestic Activities |
4.8% |
29.7% |
|
Engage in Economic Activities |
31.0% |
4.9% |
|
School is far off |
0.5% |
3.4% |
|
Unable to cop-up with studies |
5.4% |
4.6% |
|
Completed desired level/ Class |
5.7% |
6.5% |
|
Marriage |
|
13.9% |
|
Other reasons |
5.1% |
6.2% |
Note: Other reasons include: (i) timings of educational Institution not suitable, (ii) language/medium of Instruction used unfamiliar, (iii) inadequate number of teachers, (iv) quality of teachers not satisfactory, (v) unfriendly atmosphere at school. For girl students, other reasons also include: (i) non-availability of female teachers, (ii) non-availability of girl’s toilet.
Sources: Educational Statistics at Glance 2018, MHRD; PRS.
The NEP recommends strengthening of existing schemes and policies which are targeted for such socio-economically disadvantaged groups (for instance, schemes for free bicycles for girls or scholarships) to tackle dropouts. Further, it recommends setting up special education zones in areas with significant proportion of such disadvantaged groups. A gender inclusion fund should also be setup to assist female and transgender students in getting access to education.
Increasing GER in Higher Education to 50% by 2035
The NEP aims to increase the GER in higher education to 50% by 2035. As of 2018-19, the GER in higher education in the country stood at 26.3%. Figure 2 shows the trend of GER in higher education over the last few years. Note that the annual growth rate of GER in higher education in the last few years has been around 2%.
Figure 1: GER in Higher Education (2014-15 to 2018-19)
Sources: All India Survey on Higher Education, MHRD; PRS.
Table 3: Comparison of GER (higher education) with other countries
|
Country |
GER (2017-18) |
|
India |
25% |
|
Brazil |
51% |
|
China |
49% |
|
Indonesia |
36% |
|
South Africa |
22% |
|
Pakistan |
9% |
|
Germany |
70% |
|
France |
66% |
|
United Kingdom |
60% |
Sources: UNESCO; PRS.
The NEP recommends that for increasing GER, capacity of existing higher education institutes will have to be improved by restructuring and expanding existing institutes. It recommends that all institutes should aim to be large multidisciplinary institutes (with enrolments in thousands), and there should be one such institution in or near every district by 2030. Further, institutions should have the option to run open distance learning and online programmes to improve access to higher education.
Foundational literacy and numeracy
The NEP states that a large proportion of the students currently enrolled in elementary school have not attained foundational literacy and numeracy (the ability to read and understand basic text, and carry out basic addition and subtraction). It recommends that every child should attain foundational literacy and numeracy by grade three.
Table 4 highlights the results of the National Achievement Survey 2017 on the learning levels of students at Grade 3 in language and mathematics. The results of the survey suggest that only 57% students in Grade 3 are able to solve basic numeracy skills related to addition and subtraction.
Table 4: NAS results on learning level of Grade-3 students
|
Learning level (Grade 3) |
Percentage of students |
|
Ability to read small texts with comprehension (Language) |
68% |
|
Ability to read printed scripts on classroom walls such as poems, posters (Language) |
65% |
|
Solving simple daily life addition and subtraction problems with 3 digits (Mathematics) |
57% |
|
Analyses and applies the appropriate number operation in a situation (Mathematics) |
59% |
Sources: National Achievement Survey (2017) dashboard, NCERT; PRS.
To achieve universal foundational literacy and numeracy, the Policy recommends setting up a National Mission on Foundational Literacy and Numeracy under the MHRD. All state governments must prepare implementation plans to achieve these goals by 2025. A national repository of high-quality resources on foundational literacy and numeracy will be made available on government’s e-learning platform (DIKSHA). Other measures to be taken in this regard include: (i) filling teacher vacancies at the earliest, (ii) ensuring a pupil to teacher ratio of 30:1 for effective teaching, and (iii) training teachers to impart foundational literacy and numeracy.
Effective governance of schools
The Policy states that establishing primary schools in every habitation across the country has helped increase access to education. However, it has led to the development of schools with low number of students. The small size of schools makes it operationally and economically challenging to deploy teachers and critical physical resources (such as library books, sports equipment).
With respect to this observation, the distribution of schools by enrolment size can be seen in the table below. Note that, as of September 2016, more than 55% of primary schools in the country had an enrolment below 60 students.
Table 5: Distribution of schools by enrolment size
|
Strength (Grade) |
Below 30 |
31-60 |
61-90 |
91-120 |
121-150 |
151-200 |
More than 200 |
|
Primary schools (Class 1-5) |
28.0% |
27.5% |
16.0% |
10.3% |
6.3% |
5.6% |
6.4% |
|
Upper primary schools (Class 6-8) |
14.8% |
27.9% |
18.7% |
15.0% |
8.4% |
7.2% |
8.0% |
|
Upper primary schools (Class 1-8) |
5.7% |
11.6% |
13.0% |
12.1% |
10.4% |
13.4% |
33.8% |
Sources: Flash Statistics on School Education 2016-17, UDISE; PRS.
While nearly 80% primary schools had a library, only 1.5% schools had a librarian (as of September 2016). The availability of facilities is better in higher senior secondary schools as compared to primary or upper primary schools.
Table 6: Distribution of schools with access to physical facilities
|
Facilities |
Primary schools (Class 1-5) |
Upper primary schools (Class 1-8) |
Higher senior secondary |
|
Library |
79.8% |
88.0% |
94.4% |
|
Librarian |
1.5% |
4.5% |
34.4% |
|
Playground |
54.9% |
65.5% |
84.3% |
|
Functional computer |
4.4% |
25.2% |
46.0% |
|
Internet connection |
0.9% |
4.2% |
67.9% |
Sources: Flash Statistics on School Education 2016-17, UDISE; PRS.
To overcome the challenges associated with development of small schools, the NEP recommends grouping schools together to form a school complex. The school complex will consist of one secondary school and other schools, aanganwadis in a 5-10 km radius. This will ensure: (i) adequate number of teachers for all subjects in a school complex, (ii) adequate infrastructural resources, and (iii) effective governance of schools.
Restructuring of Higher Education Institutes
The NEP notes that the higher education ecosystem in the country is severely fragmented. The present complex nomenclature of higher education institutes (HEIs) in the country such as ‘deemed to be university’, ‘affiliating university’, ‘affiliating technical university', ‘unitary university’ shall be replaced simply by 'university'.
According to the All India Survey on Higher Education 2018-19, India has 993 universities, 39,931 colleges, and 10,725 stand-alone institutions (technical institutes such as polytechnics or teacher training institutes).
Table 7: Number of Universities in India according to different categories
|
Type of university |
Number of universities |
|
Central University |
46 |
|
Central Open University |
1 |
|
Institutes of National Importance |
127 |
|
State Public University |
371 |
|
Institution Under State Legislature Act |
5 |
|
State Open University |
14 |
|
State Private University |
304 |
|
State Private Open University |
1 |
|
Deemed University- Government |
34 |
|
Deemed University- Government Aided |
10 |
|
Deemed University- Private |
80 |
|
Total |
993 |
Sources: All India Survey on Higher Education 2018-19; PRS.
The NEP recommends that all HEIs should be restructured into three categories: (i) research universities focusing equally on research and teaching, (ii) teaching universities focusing primarily on teaching, and (iii) degree granting colleges primarily focused on undergraduate teaching. All such institutions will gradually move towards full autonomy - academic, administrative, and financial.
Setting up a National Research Foundation to boost research
The NEP states that investment on research and innovation in India, at only 0.69% of GDP, lags behind several other countries. India’s expenditure on research and development (R&D) in the last few years can be seen in the figure below. Note that the total investment on R&D in India as a proportion of GDP has been stagnant at around 0.7% of GDP. In 2018-19, the total expenditure on R&D in India was Rs 1,23,848 crore. Of this, Rs 72,732 crore (58%) of expenditure was by government, and the remaining (42%) was by private industry.
Figure 2: R&D Expenditure in India (2011-12 to 2018-19)
Sources: S&T Indicators Table 2019-20, Ministry of Science and Technology, March 2020; PRS.
Figure 3: Comparison of R&D expenditure in India with other countries (2017)
Sources: S&T Indicators Table 2019-20, Ministry of Science and Technology, March 2020; PRS.
To boost research, the NEP recommends setting up an independent National Research Foundation (NRF) for funding and facilitating quality research in India. The Foundation will act as a liaison between researchers and relevant branches of government as well as industry. Specialised institutions which currently fund research, such as the Department of Science and Technology, and the Indian Council of Medical Research, will continue to fund independent projects. The Foundation will collaborate with such agencies to avoid duplication.
Digital education
The NEP states that alternative modes of quality education should be developed when in-person education is not possible, as observed during the recent pandemic. Several interventions must be taken to ensure inclusive digital education such as: (i) developing two-way audio and video interfaces for holding online classes, and (ii) use of other channels such as television, radio, mass media in multiple languages to ensure reach of digital content where digital infrastructure is lacking.
In this context, we analyse: (i) the availability of computer and internet across households in India, and (ii) ability to use computer or internet by persons in the age group of 5-14. As of 2017-18, the access to internet and computer was relatively poor in rural areas. Only 4.4% of rural households have access to a computer (excludes smartphones), and nearly 15% have access to internet facility. Amongst urban households, 42% have access to internet.
Table 8: Access to Computer and Internet across households (2017-18)
|
Access to ICT |
Rural |
Urban |
Overall |
|
Households having computer |
4.4% |
23.4% |
10.7% |
|
Households having internet facility |
14.9% |
42.0% |
23.8% |
Note: Computer includes desktop, laptop, notebook, tablet. It does not include smartphone.
Sources: Household Social Consumption on Education (2017-18), Ministry of Statistics and Programme Implementation, July 2020; PRS.
Table 9: Ability to use Computer and Internet across persons in the age group 5-14 (2017-18)
|
Ability to use ICT |
Rural |
Urban |
Overall |
|
Ability to use computer |
5.1% |
21.3% |
9.1% |
|
Ability to use internet |
5.1% |
19.7% |
8.8% |
Note: Ability to use computer means to be able to carry out any of the tasks such as: (i) copying or moving a file/folder, (ii) sending emails, (iii) transferring files between a computer and other devices, among others. Ability to use internet means to be able to use the internet browser for website navigation, using e-mail or social networking applications.
Sources: Household Social Consumption on Education (2017-18), Ministry of Statistics and Programme Implementation, July 2020; PRS.
Public spending on education to be increased to 6% of GDP
The recommendation of increasing public spending on Education to 6% of GDP was first made by the National Policy on Education 1968 and reiterated by the 1986 Policy. NEP 2020 reaffirms the recommendation of increasing public spending on education to 6% of GDP. In 2017-18, the public spending on education (includes spending by centre and states) was budgeted at 4.43% of GDP.
Table 10: Public spending on Education (2013-2018)
|
Year |
Public expenditure (Rs crore) |
% of GDP |
|
2013-14 |
4,30,879 |
3.84% |
|
2014-15 |
5,06,849 |
4.07% |
|
2015-16 |
5,77,793 |
4.20% |
|
2016-17 |
6,64,265 |
4.32% |
|
2017-18 |
7,56,945 |
4.43% |
Sources: 312th Report, Standing Committee on Human Resource Development, March 2020; PRS.
Figure 4: Comparison of public spending on Education in India with other countries as % of GDP (2015)
Sources: Educational Statistics at Glance 2018, MHRD; PRS.
In the figure below, we look at the disparities within states in education spending. In 2020-21, states in India have allocated 15.7% of their budgeted expenditure towards education. States such as Delhi, Rajasthan, and Maharashtra have allocated more than 18% of their expenditure on Education for the year 2020-21. On the other hand, Telangana (7.4%), Andhra Pradesh (12.1%) and Punjab (12.3%) lack in spending on education, as compared to the average of states.
Figure 5: Budgeted allocation on Education (2020-21) by states in India
Note: AP is Andhra Pradesh, UP is Uttar Pradesh, HP is Himachal Pradesh and WB is West Bengal.
Sources: Analysis of various state budget documents; PRS.
For a detailed summary of the National Education Policy, see here.
