Shadowboxing over coal

BJP and Congress might argue about allocations vs auctions,but both agree on the denationalisation of a vital natural resource

Written by Brinda Karat | Published: September 5, 2012 2:49 am

A coal mine worker in Jharkhand and an expert on the coal industry called to protest against what he called was the noora kushti (shadowboxing) going on in Delhi. The power of the coal players was earlier seen in Jharkhand politics,he said,but now we see it in Delhi. Our players are small,yours are big and powerful. With the CBI itself unearthing prima facie evidence of gross manipulation and wrongdoing in the allocation of coal blocks,the defence of the ruling party that everything is hunky dory and this is just enemy propaganda,falls flat. There is growing evidence of “big players” involved,which is why the Left parties’ demand of a time-bound high level inquiry into the entire process of allocations,including the functioning of the screening committee,the recommendations from individual ministers or MPs that require scrutiny,is entirely justified. Of the 76 or so private companies who were allocated coal blocks,few have operationalised the contracts. The government guidelines clearly and specifically state that in the blocks where exploration has been done,the company has to start operations in 36 months for open cast mining and 48 months for underground mining along with specific goals within this period. Instead,while these targets have not been met,the allocations have been used speculatively,as assets to push up share valuations,making windfall gains while the public exchequer was deprived of revenue and the nation lost valuable natural resources. No action has been taken.

There is another aspect to coal policy that has escaped attention in this debate — the losses suffered by lakhs of families who are forcibly displaced due to land acquisition. The companies are supposed to be responsible for their resettlement,but there is no audit done,no information available as to what the actual position is. It is as if their interests have nothing to do with policies regarding the allocation of mines to private companies who use strong arm methods to throw them off the land.

The prime minister’s statement did not deal with any of these issues and instead sought to justify the government’s actions. The Congress’s typical reaction,whether in the 2G scam,the Commonwealth Games,the Adarsh scam or now in the coal scam,to first deny any wrongdoing and corruption and then in the face of incontrovertible evidence,blame others,going so far in this case as to personally attack the CAG,is precisely what incenses public opinion.

By not allowing Parliament to function,the BJP has done a great disservice to the struggle against corruption. The example given by some BJP leaders of the success of the strategy used in the winter session of 2010 to stall Parliament and ensure the resignation of the minister concerned and the setting up of a JPC is quite inappropriate. The BJP forgets that at that time,there had been at least three discussions in Parliament on the issues of spectrum allocation in which the blatant involvement of those subsequently arrested and accused was laid bare before the House and the people of the country.

In the light of the CAG report,the main criticism by the BJP is that the government deliberately continued the route of discretionary allocations instead of auctions,while the government counters that it wanted to auction but was prevented from doing so by state governments,including those led by the BJP and the Left. The issue is reduced to a narrow framework and a meaningless blame game.

Discretionary quotas can certainly lead to manipulation and corruption and have done so in the present case,but so can auctions,which have the additional problem of a few big corporations with deep pockets cornering natural resources through sheer money power,leading to monopolisation and cartelisation. With the government encouraging foreign direct investment in the coal sector,the auction route becomes even more questionable.

It is common sense that since these resources are finite,there must be a plan for both use and conservation. Clearly,only government can take this responsibility through a transparent and accountable government apparatus,which is why the coal mines were nationalised in the first place. But in consonance with the neoliberal policy framework initiated in the early 1990s,incremental privatisation was introduced in the coal sector through amendments in the Coal Mines (Nationalisation) Act of 1973 and in the rules. These included allocating coal blocks for mining initially to private companies producing iron and steel and was then expanded to give captive mines to companies in power and cement and most recently,gasification and liquefication. This was accompanied by a corresponding weakening of public sector coal companies through outsourcing various processes and reduction in the workforce.

Today,while the permanent workforce in Coal India is halved to 3.5 lakh workers,50 per cent of the coal produced is through the labour of contract workers with dismal wages. The private sector has gained control of around 20 per cent of India’s known coal reserves,estimated by the Geological Survey of India to be in the range of 118 billion tonnes. However,only a fraction has been operationalised,belying the promise that handing over captive mines to the private sector would lead to a big increase in infrastructure. Even where private companies are mining the coal,they impose slave labour conditions on the workers to keep costs down. These are usually less than 10 per cent of the production cost compared to around 50 per cent in publicly run mines.

But even though the reasoning advanced for denationalisation has proven to be utterly flawed,the Manmohan Singh government wants to push through with the amendment to the coal nationalisation act moved by the BJP-led government in 2000. This amendment,still pending before the Rajya Sabha,seeks to remove any conditions for end use in the existing policy on captive mines. The amendment says,“any company may carry on coal mining operations in India in any form for own consumption,sale or for any other purpose”. The Left parties and India’s working class movement,represented by all central trade unions that have been opposing privatisation at every stage,have been able to prevent such a disastrous step,which would legally open up India’s coal resources to loot and plunder. Public sector companies must be strengthened and expanded as the nodal agencies for mining and for allocations.

But both the Congress and the BJP,who shadowbox on issues like allocations vs auctions,agree on the actual fundamental issue of denationalisation of a national asset. Let these issues be debated,the working people of India know that the noora kushti in Delhi cannot conceal the deep,common class affinity in the outlook of the Congress and the BJP to serve the interests of corporate India.

The writer is a member of the CPM politburo

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