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As you keep ticking boxes, new issues come up: Anil Swarup

11 February, 2016

Anil Swarup, a 1981 batch Indian Administrative Service officer of the Uttar Pradesh cadre, is credited with setting up a template for natural resource allocation in India through coal block auctions. Handpicked for the job of coal secretary by Prime Minister Narendra Modi, Swarup enjoys the reputation of being a go-getter. He has been instrumental in expediting coal mining in the country—a pre-requisite to fuel India’s manufacturing needs. A postgraduate in political science from Allahabad University, Swarup introduced the national insurance scheme for the unorganised sector as the head for the Rashtriya Swasthya Bima Yojana. He also led the efforts to clear the logjam in infrastructure projects during the United Progressive Alliance government. In an interview, Swarup talks about the need to concentrate on delivering high quality coal and status of mining at the awarded blocks. Edited excerpts:

Since you joined the coal ministry in October 2014, which are the boxes that you have ticked and which are the ones yet to be ticked?

Actually, boxes keep emerging. As you keep ticking boxes, new ones come up and then you start visualizing more things to be done. As you keep working, new avenues emerge, you learn, you reflect and then you visualize. When I joined as the coal secretary, at that point in time quality of coal and crushing of coal was not an issue. The issue was availability of coal. There was an acute shortage of coal in the country. So the immediate concern was to get coal. Now, that issue has by and large been settled in terms of increased coal production and reduction in imports. We are now focusing on issues such as quality of coal crushing and environment.

Increased availability of coal has led to a peculiar situation wherein its offtake has become a concern. Given this condition, shouldn’t production be reduced?

Not really. I think production has reached a level which gives us some sense of satisfaction in terms of making coal available to power plants, a part that was missing last year.

Where do we go from here?

We are now focusing on issues such as quality which was a serious concern in the past. But it never got considered because the first objective was to get coal. Now we are looking at quality starting with crushing of coal. Second, we are looking at washing coal and washeries are being set up. By 1 October 2017, all coal above a particular grade (with minimum gross calorific value 4,301 kilocalorie/kg) will be washed and sent. Third, we have put in place a mechanism to ensure that consumer pays only for the quality that is supplied. There were a lot of complaints regarding grade slippage. We have set up a mechanism through which these quality measures can be enforced, implemented on the ground and there would be a third-party assessment for quality. The first one has already started, the other two will happen in the due course.

Do we have big washeries in India today?

Not very big washeries. Actually, washing was not a priority for Coal India Ltd (CIL). The immediate concern earlier was the volume of coal as it was not available. We imported 250 million tonne of coal last year. There was a huge amount of import in a country where we have a reserve of 300 billion tonne. Import is fine for coal which is not available, such as coking coal. But if you are importing non-coking coal, which is available in India, that’s a serious problem.

What is the status of mining at the coal blocks which have been awarded?

Ten of the schedule II mines (where mining has happened earlier) have started producing coal. We expect that most of (the rest) schedule II mines should start operating by 31 March (this year). I think given the conditions on the ground, it is good progress.

Most of it (the set production target of 1.5 billion tonne by 2020) will come from schedule III mines (at various stages of development) which will start production in two to two-and-a-half years. We don’t expect schedule III mines to start producing immediately as there is a lot of work to be done. But schedule II mines (both auctioned and allotted) should start producing soon.

Why has the fourth round of coal block auction been called off?

Fourth round could not happen because there were not too many takers. Today, there is a lot of coal available in India. Why take the trouble of digging coal when it is available otherwise?

The Coal Mines (Special Provisions) Act, 2015, states that Indian companies and Indian subsidiaries of foreign companies will be eligible for commercial mining. What is its status?

It is still under consideration but it is difficult to give a timeline. We are doing the groundwork as commercial mining is a sensitive issue. If we don’t do the necessary groundwork, we will receive criticism. It is not an easy proposition as there are a number of aspects that have to be looked at.

Given the rout in resources space, is it a good time for CIL to acquire coal mines overseas?

No. The point is that if you have sufficient coal available here, why do you want to go abroad? If a good valuable mine does become available, the board (of CIL) will have to take a call.

I have not given a thought about acquisition of assets abroad. We have been totally focused on what can happen in India. There is so much to be done in India, so much more can become available. We are looking at 1.5 billion tonne per annum.

Will coal prices be revised in the near future?

Price revision happens periodically and CIL takes a call on that. The last price revision was done in 2013 and no price revision has happened thereafter.

In December 2015, the Cabinet approved a policy framework for development of underground coal gasification in coal and lignite bearing areas in the country. What is the current status?

The group has been constituted and mines have been identified. They will look at various aspects and then take a call. We are moving ahead with that.


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As you keep ticking boxes, new issues come up: Anil Swarup

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