Govt may accept Deloitte report, split Coal India into smaller companies
With persistent coal shortages short-circuiting India’s power generation plans, the government is set to undertake the restructuring of state behemoth and world’s largest coal miner, Coal India Ltd (CIL), by creating multiple mega coal companies in line with the recommendations of a government-commissioned study by global consulting firm Deloitte.
Power generation in India is primarily coal-driven, and around 70% of the country’s total installed power capacity of 250,000 mega watt is generated using coal as fuel.
Coal shortages also have a direct political fallout as millions of people in India are without power, and blackouts are a common phenomenon. Coal shortages are also slowing down industrial activity in the country.
CIL and its seven subsidiaries produce about 80% of India’s coal output at 450 million tonnes. However, CIL has repeatedly failed to meet production targets, leading to heavy dependence on imported coal.
The restructuring exercise seeks to increase India’s coal production manifold and reduce dependence on imports. India imported 142 million tonnes of coal worth $16 billion in 2013-14.