BLACK BUSINESS

On June 18, Prime Minister Narendra Modi, speaking at an event to auction 41 coal blocks for commercial mining, said that India needs to use its domestic coal for energy needs.

- ISHAN KUKRETI, KUNDAN PANDEY, SOUNDARAM RAMANATHAN & SUGANDHA ARORA 

The event marked the move to open up the sector to private players—100 per cent Foreign Direct Investment (FDI) and no restrictions on the end-use of coal. Till now, miners were not allowed to trade coal in the market. Coal was mined either by the public sector Coal India Limited or by other companies given mining rights for their captive use through allotment or by auction.

Energy security tops the government agenda in post-COVID-19 times. The prime minister stressed that this auction “would bring the coal sector out of many years of lockdown”. India, he said, “has the fourth largest coal reserves in the world, and is the second largest producer. So why can we not become the largest producer in the world?”

To make coal “green”, the government has announced to invest ₹20,000 crore in four projects to convert 100 million tonnes of coal into gas by 2030. The problem is coal reserves are found ensconced in the deepest and densest of forests, where very poor people, mostly tribals, live. This means when the country begins mining new areas for more coal, the casualty will be the pristine forests and the dwellers within.

The question is why does India need to dig more for coal? Are the country’s current coal mines insufficient? Or, does it need to replace domestic coal with imported coal? What is that internal logic that drives this policy?