‘That the CAG does not have a motive ought to have come out in the report. It does not’

Everyone has to be in the dock at some point in time. But the one who comes out clean is the one who is successful.

Who can emerge from a coal mine without a stain or two… There is an old saying,koyle ki dalaali mein munh kaala… It is the nature of the coal business…

It is not,if the person is honest and his conscience is clear. Dr Manmohan Singh will come out clean. There is no doubt about it.

But why did Manmohan Singh get involved in this?

We all know about Dr Singh’s thought process. He did not become the Prime Minister to sit idle,but to work for the growth of the nation. He wanted industries to grow. He wanted to bring about an economic revolution. And that’s what he did.

You say all this was done for the nation’s growth,but Arun Jaitley has countered this,saying the coal has not yet been mined,so how does it contribute to GDP?

It is a different issue that coal has not been mined. There are a lot of problems in coal mining. Most of the mines are located in far-flung areas,some are located in dense forests. It takes a lot of time to get forest and environmental clearance. Forest dwellers know their rights and want their fair share before allowing any land acquisition. Secondly,was there any option other than allocating the mines? Had we sat idle,how would we have had growth? And the most important thing is,how can we import coal at high rates when we are sitting on coal reserves ourselves?

Because we have coal in our country does not mean we go about distributing it free of cost.

There is no question of distributing coal free of cost. Today everyone is demanding that auctioning of coal blocks should have taken place. But once they are auctioned,the end produce generated through the auctioned coal,be it power or steel,is bound to be high.

Prices will shoot up. But what is the guarantee that the benefit these companies have got will be passed on to consumers in terms of the price of electricity?

There is no guarantee. The only guarantee is that we are giving our coal to our miners. The power purchase agreements (PPAs) they sign with the power ministry will be based on the price for which they are getting coal,based on which they will set the price for the electricity they generate.

Have you created a regulation whereby the rates and prices will be reflected in the PPAs?

Yes,only those people who sign the PPA with the power ministry and the Central Electricity Regulatory Authority will get coal blocks.

Has anyone signed a PPA based on this?

Many have.

But are the PPAs reflecting the value of free coal?

Many have signed the PPAs. NTPC generates thousands of megawatt of electricity. It knows and determines the price of the power that it generates from a given quantity of coal.

But the companies that have been allotted coal blocks,are they not all power-producing companies?

No,there are steel manufacturers too.

In that case,how do you determine the rates?

It is based on a very simple principle. The rate depends on the produce that you are offloading in the market. It is all market-driven.

Do you dispute the idea of an auction?

The good part about bidding is that it is a transparent procedure. No one will be able to point a finger at you. But its effect will be visible only after five years. Personally,I am not very optimistic about auctioning. Electricity prices are linked to that of coal. Power and steel prices will shoot up. But we want the whole process to be transparent.

So auction remains the only choice.

Does that mean that the process by which coal was allocated all these years was not transparent?

The earlier process was also transparent but the requirement of coal has shot up several times. Till five years ago,the demand was not so high. Maybe no one would have turned up had we gone in for bidding then. But I still doubt how many people will come forward for the bidding.

Why do you think so?

I don’t think anyone will sign the PPA after buying coal through auctions.

But wasn’t there a long queue of companies waiting to get coal blocks?

There was a line. But they were being allotted coal blocks. That is why they were coming and were ready to mine coal,setting up power plants and signing PPAs. Now,if you demand the full price,why would they sign PPAs?

They will sign the PPAs at a higher price. For example,Reliance had signed the PPA at Rs 1.19,they will sign it for Rs 4.

If they sign it at Rs 4,where will they pass on the benefit of prices to the consumers?

But it is an Ultra Mega Power Project (UMPP) and in UMPP,the tariff is decided first and then the company is allocated the coal block.

UMPP is a different system.

But the people to whom you have allocated coal,they have not committed to any particular tariff.

No,but they will do it eventually. There are strict instructions that you can mine coal only if you sign the PPA.

You have started de-allocating mines and have already done so with 26. So how can you say that the CAG report is entirely wrong?

In principle,we don’t agree with the CAG report. The criteria chosen by CAG to assess the loss is wrong. Coal mines are situated in areas where the law and order situation is very bad. People are not ready to enter those areas to explore the mines. Some of these mines are in dense forests. How will they get environmental and forest clearances? Also,the tribals are now much more aware. How will they let you acquire land? There are a lot of problems. The most important fact is,the difficult mines have been allocated (to private firms) and Coal India has got all the easy mines.

How do you define difficult mines?

Difficult mines are those in dense forests,where the law and order situation is bad and where people do not want to go. They are deep mines. In some places,the geo-mining conditions are adverse.

There are lots of open-cast mines too.

People prefer open-cast mining. Not many want to opt for underground mining. I do not want to criticise the bidding process now. After two to four years,we can look back and assess the bidding process. There is a hullabaloo that the bidding process should be adopted. But who were the people opposed to it? That is the real story. Those who are opposing the allocation of coal blocks should now be asked why their chief ministers opposed the bidding process. Chief secretary-ranked officers used to attend those meetings and collectively oppose the process. There was a meeting of the PMO with the chief secretaries of coal-bearing states on August 5,2005. They took a collective decision that the bidding process should not be brought into effect.

But in Screening Committee meetings,did any official from any state say that the allocation process was wrong?

They said that it was the only right move. They said that if you go by the bidding process,that will be the biggest mistake. If it is assessed based on the Sarkaria Commission report,it will be wrong.

It is argued that coal is a major mineral and that states have the right to things like sand,boulders,stones.

The state has the right to all minerals,especially coal. Do you know the price that was needed to make them agree to the bidding process? When we called a meeting of all the states in 2010,we told them that apart from the royalty that they get,they will be given all the revenue generated by the bidding process. Only then did they agree to opt for the bidding process.

There is an impression that the Congress funded itself through this process and won the 2009 elections to retain power at the Centre. It is said that people who paid were given receipts.

It doesn’t always happen like this. There are a lot of party sympathisers who donate funds and these days everything is done through cheques.

Can you say with a hand on your heart that you never imposed a pre-condition on anybody that you pay by cheque,bring a receipt and take away the rights to a mine?

Never. It’s a laughable question. If someone like Arun Jaitley says this,I can understand,because they have no other issues left.

He has been saying this,and there is an impression too.

It is entirely wrong.

Hand on your heart?

Bilkul sahab… (With a hand on the left side of his chest) Idhar hota hai na?

Yes,that’s where the heart ordinarily is. But you people are tough,you may have two… Some 142 mines were allocated. Are you sure they were allocated properly? That there were no mala fide cases?

We can’t guarantee it. That is why a CBI inquiry has been ordered. The only reason behind the CBI probe is that maybe some companies might have given false statements. Maybe a company is worth Rs 10 crore but has presented its value at Rs 100 crore. Maybe the officers who verified these companies gave a false statement under pressure. Things like this happen. We cannot deny it. The CBI probe is so that the truth comes out,so we know who are the people who tried to mislead the Screening Committee.

You are a seasoned politician. Tell me,isme kitna doodh hai aur kitna paani?

I believe there was no better way to fulfil the coal requirement of the country (than allocation). No better way to ensure that more power plants were set up,no better way to ensure the industrial growth of the country.

Are you going to cancel allocations?

No. There is no such proposal.

It is being said that if you go through the auction process,it will be clear if the CAG report was correct or not.

Based on the CAG report,they are demanding the resignation of the Prime Minister. Why weren’t resignations of Narendra Modi (Gujarat),Shivraj Singh Chouhan (Madhya Pradesh) and Raman Singh (Chhattisgarh) sought based on the CAG reports?

At what level did you hold interactions with CAG?

I didn’t have any direct interactions with CAG. It is said that in its draft report,CAG had estimated the loss at Rs 10 lakh crore. Later,they came down to Rs 1.5 lakh crore. Our officers had told CAG to call them before finalising the report so that they could tell the auditor where it was going wrong. But none of our officers were called. Also,the criterion used by CAG to assess the loss is baseless. How can you compare prices based on mining done by Coal India? How do you know how deep the mine is? Or the geo-mining conditions,whether it will be open-cast mine or underground etc? They do not know anything,yet they assess the loss.

But CAG is a constitutional body. It has no motive. It is not your competitor.

That it does not have a motive ought to have come out in the report.

The CAG report does not come clean on motive.

You do not trust the CAG report but even then,you will go ahead with the auction process?

The mood in the country is that auctioning is the most transparent process. But it might affect coal production. It may affect the country’s growth in an adverse way. But we do not have a choice.

So when do we see the first mines being auctioned?

It should take at least another two-three months.

And what about the UMPP case of Reliance?

It was the Empowered Group of Ministers (EGoM) which took the decision.

You don’t see anything wrong in that?

I am not saying whether it is wrong or just. All I know is that the EGoM took the decision keeping the situation in mind. There are no ifs or buts here.

So there is no question of de-allocation?

Our government does not have a policy on de-allocation of coal blocks. However,those companies that fail to meet milestones or show false returns will have their mines de-allocated. They will also face investigations and will be punished accordingly.

Yashwant Sinha says an amendment to the Coal Mines (Nationalisation) Act has been pending since 2000. It was moved in the Rajya Sabha,but you (UPA) have not activated it.

Why didn’t they do it when they were in power? It is not an easy bill. It is the kind of bill for which you have to first persuade the trade unions,you have to take all parties into confidence,particularly the left… They will not be convinced easily…

Are you willing to take it up?

Apart from commercial mining,there is no other way to produce more coal. We should get the commercial mining bill passed.

The basis of commercial mining is auction. Is Congress willing to take this forward?

If everyone is willing… all the other parties and trade union leaders are willing,then we don’t see any problem.

The amendment to the Mines and Minerals (Development and Regulation) (MMDR) Act has been done only for captive mining. Do you have to amend the Coal Mines (Nationalisation) Act to allow commercial mining?

It is pending in the Rajya Sabha. Only when it is amended can we go for commercial mining.

Will you appeal to the BJP?

We will appeal to everyone,to the left,to the BJP,to all parties,that we should build a consensus that whatever is in the interest of the nation,we will do…

You have been given a very problematic portfolio. Do you ever complain?

I don’t complain. In politics,the more difficult the circumstances,the brighter people shine…

You remember (the song from Dilip Kumar’s Gopi),kaajal ki kothri mein kaisa bhi jatan karo,kaajal ka daag bhai laage hi laage (Howsoever hard you may try,if you walk into a room painted with kaajal,you are bound to get a blot or two)… Have you ever felt you are going where you are bound to pick up a stain?

Never…

Have you been tainted yet?

I don’t think so.

There is a widespread impression that (coal block allocation) became a major source of funding. You allocated 142 mines,you creamed the market,now you are saying the government will go in for auctioning.

It is not like that. Even funding has become very transparent. It is done through cheques.

But even in the case of paid news during elections,the media is paid in cash. That cash obviously comes from somewhere else.

It can come from anywhere.

But it hasn’t come from coal?

There is no question.

You are in charge of a very tempting ministry. Have you ever been offered something in lieu of getting some work done?

The offers come only when you accept them. People know that I won’t get involved in such things,so they don’t approach me.

You are a tough man and a thick-skinned man. Both these aspects of your personality will be on test in the coming months. Stay in the headlines and we will be chasing you.

Translated by Sidheshwar Shukla and transcribed by Aditi Ray