The reserve price and the upfront payment should be based on the mineable reserves
The Associated Chambers of Commerce and Industry of India (Assocham) in a letter to Coal Minister Piyush Goyal, has suggested that auction of all cancelled coal blocks should be done by March 2015 so that the operations of existing end-use plants would not be affected. It has also suggested that the auction should be done either at one go or majority of them should be put on the block together. The industry body has sought a meeting with the Minister so that it could make a presentation and put forth its views. The reserve price and the upfront payment should be based on the actual mineable reserves and not on the basis of geological reserves, Assocham suggested.
Coal blocks earlier allotted for power-plants should only be auctioned for power plants while those allotted to steel plants should be reserved for that sector.
Assocham felt that the retrospective payment of Rs.295 a tonne penalty was erroneous as CAG had calculated that figure, taking into account all grades of coal.Assocham also pointed out that the government-suggested penalty was for retention of the 40 operational blocks and not for cancellation. It further suggested that the government could file for a review of the order.
The auction process should accord the right of first refusal to the existing allocates, who have end-use plants which are either operational or are going to become so soon, Assocham said.
Source: The Hindu
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