Government to rationalise coal prices, says Piyush Goyal
The coal ministry will rationalise coal prices aligning it with gross calorific value (GCV), so that the price disparity is eliminated across various grades of coal. Coal and power minister Piyush Goyal told reporters that certain grades were not being priced properly. “We need to rationalise pricing based on GCV,” Goyal said.
He made it clear that rationalising coal prices didn’t mean downward revision of coal prices to bring parity with falling international prices. “Indian coal prices were never benchmarked with international prices and any rationalisation will not be aligned with international prices,” Goyal said.
Coal India Ltd (CIL) shifted from useful heat value-based (UHV) pricing to GCV-based pricing prior to its maiden IPO, to price coal on international parity prices. Since CIL offered coal at a deep discount of up to 50%, the company advised the government to change the pricing mechanism so that Indian coal prices were worked out on the basis of market forces and on the basis of international standards. There were even suggestions of a regulator, which would determine Indian coal prices.