Table of Contents
Coal sector in India
Approach for mains
- Background
- Facts and Figures
- Issues with the coal sector in India
- Reasons for current power crisis in India
- Steps taken by the government
- Question of the day
Background
- Immediately after independence , coal mines were not totally in the hand of government
- But gradually with change in time and as the demand increased the need to extract also increased and it requires huge capital investment along with poor working condition
- Nationalisation in two phases in 1971- coking mines and 1973 non coking mines
- Coal mines nationalisation act 1973, was passed to nationalise coal mines
- Demand supply mismatch , then in 1991 allowed for captive mining.
- In 2015 government allowed private players but there was scam in allocation of coal mines , so Supreme court intervened and quashed the allocation
- In 2020 again they allowed commercial mining of coal
Fact and Figure
- India has 5 th largest coal reserves in world
- 2 nd largest producer and consumer of coal
- India has mostly Bituminous coal and is dependent on imports for Coking coal.
- In last 20 years coal import and production both have risen but import has rose with much fast pace
- About power generation-Coal contributes to over 70 per cent of India’s power generation
Issues with the Coal Sector in India
- Lack of good quality coal leads to dependence on Imports
- Limited use of technology has led to low productivity in the coal fields
- Transportation challenges due to limited availability of Rail wagons
- Highly regulated sector lead to fall in the output
- Delays in clearances for land acquisition, resettlement and rehabilitation increased the cost of compliance.
Reasons for current power crises in the country
- Spike in power demand due to hot temperatures and picking up of economic activity.
- Fall in imports due to hike in prices – Ukraine Russia war
- Unwanted rain in September hampered the process in mines
- Transportation challenges due to limited availability of wagons
Is the coal crisis the only reason behind the power crisis in the country?
- Long standing dues of DISCOMS to the power generation companies
- Dependence of the thermal power sector on renewable energy sector
- Pent up demand due to revival of economic activities
Steps taken by the government
- Allowed commercial mining of coal
- Government allowed 50% sale of coal from captive mines.
- Simplification of the mining plan approval process
- Earlier the companies with mining operation in India were only allowed to participate in the auctions. This has now been done away with.
- Coal Allocation Monitoring System (CAMS) to monitor the allocation of coal by CIL.
Question of this article
- Q) Coal sector is said to be marred with challenges. Despite that it has its own way of contributing to the economy. Discuss
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