Back in the Black

Coal India, whose losses were Rs 1,175 crore in 2000-01, turned around sharply with a profit of Rs 1,450 crore in 2001-02. Average coal productivity rose from 2.27 tonnes to 2.42, and wagon-loading or the actual delivery of coal rose by 2.7 per cent.

8216;8216;We wanted to send strong signals that we meant business,8217;8217; Prasad says by way of explanation. 8216;8216;I think people understand they need to perform, and then they do.8217;8217; So, for instance, if a manager was involved with a syndicate, his transfer would certainly slow down the process of theft. Managers at loading centres were also rotated along similar lines 8212; anyone who had been posted at a centre for over three years was transferred. A total of 35 managers of this cadre were transferred last year.

The loading centre, those familiar with the operations of Coal India will tell you, is another big source of possible theft. In several cases, for instance, Grade A coal gets loaded onto trucks, but gets certified and billed as the vastly cheaper Grade D coal.

Actual checks were carried out to verify the antecedents of coal buyers. Of the 4,781 units in the non-core sectors like power and steel who purchase coal from Coal India, it was found that 340 units simply didn8217;t exist 8212; in previous years, these units had been shown as buying 1.5 million tonnes of coal. Clearly, these supplies were being sold in the black market by CIL employees. Another 1,319 units of these 4,781 have still not been verified.

Says Prasad, 8216;8216;If the states don8217;t give us the details by the end of this month, the supplies to these units will be cut off. We8217;ve also told the states that if there8217;s a discrepancy between what our vigilance people say and their records, we8217;ll refer the matter to the CBI.8217;8217; While Prasad doesn8217;t have the details of the consumption of these units readily, sources say their consumption could run into 3-4 million tonnes annually.

Other steps taken by the ministry of coal include not issuing 8216;8216;delivery orders8217;8217; from Delhi 8212; the usual practice is to get a friendly MP to take you to the minister, and get him to order the allocation of 1,000 tonnes of coal to your unit on a priority basis. Spot inspections were ordered to ensure the electronic weighing machines were not tampered with and a survey was done by consultancy firm Price Waterhouse Coopers to fix the actual cost of transportation Coal India should be paying. PWC said a price of Rs 28 per tonne per kilometre was a good price as against the Rs 32-33 paid by CIL in several cases, and this was then used as a benchmark for all CIL tenders. 8216;8216;The transporters threatened not to lift CIL coal, but we told them their livelihood depended on us, and not the other way around8230; eventually they agreed.8217;8217; Ten thousand workers also availed of VRS during the year, reducing the wage bill by around Rs 100 crore.

Other plans on the anvil include closing down of unviable mines 8212; usually those over 100 years old 8212; like those in the Central Coalfields Limited CCL. Ministry estimates are that even if no employee is retrenched but is paid full wages, closure of 18 CCL mines will save Rs 42 crore. CCL, one of Coal India8217;s subsidiaries, incurred a loss of Rs 110 crore in 2001-02. A slightly higher amount could be saved by closing down 23 unviable mines in Eastern Coalfields.

And yes, while Coal India is not to be privatised, there are around 127 coal blocks that have been earmarked for captive mining 8212; these are to be opened up to private bidders once a bill pending in the Rajya Sabha is passed. Who said you could only get your face blackened in the coal business?