| NEW DELHI
NEW DELHI Aug 7 India's coal ministry said it
was studying the recommendations of consultants Deloitte on
restructuring options for Coal India, the state
behemoth that has failed to meet its output target for years
despite having access to large reserves.
A government committee has urged the ministry to restructure
the world's largest coal miner to help reduce shortage of the
fuel, which accounts for more than two-thirds of the power
generated in the country.
Responding to a lawmaker's question in the parliament if
there was plan to break up Coal India, Coal and Power Minister
Piyush Goyal said on Thursday that a draft report submitted by
Deloitte on "possible restructuring options" was "under
Reuters reported on May 21 that new Prime Minister Narendra
Modi was exploring breaking up the company and opening up the
nationalised sector to foreign investment to boost output and
Sources have said that one of the options was to convert
some of the seven producing units of Coal India into independent
firms, and making respective state governments equity holders to
help speed up land acquisition and other such processes.
The company produces about 80 percent of the total coal dug
out in India and feeds all but four of the 86 coal-based thermal
power plants, but its inability to raise production fast enough
has made India the third-largest importer of the fossil fuel.
Imports hit 168.4 million tonnes in the fiscal year through
March 31 and are rising, as the new government has promised to
scale up power output to light up every home. About 400 million
of the 1.2 billion Indians still live without electricity.
Shipments of thermal coal, used in power generation, are
expected to surge 11 percent to 150 million tonnes this fiscal
year, according to online market operator mjunction.
With growing imports and power plants running on critical
stocks, the clamour for Coal India's restructuring has grown.
The finance ministry said in its Economic Survey report on July
9 that the process of "restructuring Coal India needs to be
pushed through swiftly".
But as the government looks to shape up Coal India for a
potential stake sale and restructuring, the miner still faces
basic problems such as lack of enough mechanical shovels,
dumpers and explosives.
Goyal will also have find a way to deal with Coal India's
powerful unions, which have vowed to hit the streets against any
stake sale or restructuring.
(Editing by Mark Potter)