Anil Swarup, a 1981 batch Indian Administrative Service officer of Uttar Pradesh cadre, has shifted the focus of debate on availability of coal in India to the fuel’s quality. The country has now set up a production target of 1.5 billion tonne of coal by 2020. Swarup, India’s coal secretary, is known for his tenacity to help evolve and execute important policy initiatives such as an insurance scheme for the unorganised sector as the head of the Rashtriya Swasthya Bima Yojana, and a template for coal block auctions which is serving as a primer for awarding other minerals in the country. With Swarup not being averse to exploring new ideas, state-run Coal India Ltd’s (CIL) subsidiary Western Coalfields Ltd is promoting tourism at its mines. In an interview, Swarup talks about the possibility of revision in coal production targets due to muted electricity demand and likely impact of Ujwal Discom Assurance Yojna (UDAY) on coal demand. Edited excerpts:
Given the fact that coal imports have come down and domestic production has increased, what is the roadmap ahead? Also, with the government scaling down electricity demand, what will be its likely impact on coal production?
Right now we are going ahead with the production plan that we have for the current financial year, which is CIL’s target of 598 million tonnes. But if there is a change in the requirement for power, we will have to take a second look at it. I do not have any formal information about the reduction of requirement of coal, but if it comes formally we will take a call.
What do you expect in the short term?
Two years ago, we were woefully short of coal but now we are reasonably comfortable. Our hope is that if UDAY (a central government scheme aimed at financial turnaround of electricity distribution companies) kicks in, the demand for power will increase, and, in turn, the demand for coal will also increase.
So far state discoms (distribution companies) are not in a financial position to demand more power. There is a requirement of power on the field but the financial health of distribution companies of state governments is not very secure. Hopefully UDAY will help improve their financial condition and once their financial condition improves, they will demand more power resulting in greater demand for coal.
A number of states have issued bonds and when these are subscribed, which in a number of cases has happened, the debt will get transferred from discoms to state governments. This will enable discoms to have the fiscal space to borrow more and they can buy more power.
When is the next round of coal auction likely to take place?
We haven’t decided dates for the next round of auction, but there won’t be auctions till 30 June in the current financial year.
The auction has been put on hold for a while because in the fourth round of auction, we didn’t have too many takers. It was a direct outcome of the good work being done by CIL. Coal is being produced and its impact is that the demand is not so much now compared with what it was about 15 months ago.
What are the future plans for CIL?
The focus now is on improving the quality of coal supplied. For this, a regime has been put in place for assessment of coal samples by a third party. Four samples will be taken out of which one each will be kept by CIL and second by the user. The third sample will go for a third-party testing and if it is challenged, then the fourth sample will be used. This regime has been operational for around three months and it has been doing well but it needs to be expanded now to all mines.
Also, we have already started dispatching crushed coal that itself will take care of a lot of quality issues. Most importantly, we are setting up 15 washeries to ensure that starting 1 October 2017, only washed coal is moved out.
Does Coal India have any plans to go abroad?
Earlier, there were plans to go outside but now it is focused inwards as production is increasing. Though it is in discussion with South Africa but I don’t think that would have been on its platter compared with a year-ago period when it was short of coal.
Will Indian coal be exported?
Indian coal would not be good enough to send outside because of its high ash content. I don’t foresee Indian coal being exported.
What is your vision for the coal ministry?
Coal was a dirty word and now I would want people to believe that coal is no longer dirty. It drives the Indian economy and there is so much good happening in and around coal.
We are thinking of setting up tourist sites around coal mines. One near Nagpur is already operational and is doing very well.