Millennium Post

Judgement estimated to hike coal import bill by $3 billion

India’s coal import bill is likely to go up further by around Rs 18,000 crore due to the cancellation of coal blocks by the country’s apex court, according to a report. The Supreme Court has quashed the allocation of 214 out of 218 coal blocks alloted to various companies since 1993. Around 40 of them were operational.

‘In the event of complete de-allocation of the coal blocks, the import bill of India would jump by $3 billion. The two most impacted companies are Jindal Steel & Power and Hindalco,’ Macquaire said in recent report. ‘Any news of curtailment of India’s coal production could help revive the weak global sentiment on coal, as some companies might try to build inventory,’ it added.

India had imported around 168.4 million tonnes of coal worth Rs 95,000 crore last fiscal and this figure is expected to rise in the current year. India is the third largest importer despite having fourth largest coal reserves in the world.

Meanwhile, former Coal Secretary PC Parakh said that the Government should give the first right of refusal in the ensuing coal mine auctions to the companies that lost blocks in the mass cancellation by the Supreme Court on Wednesday.

The economy will be severely impacted if the government fails to re-allocate the cancelled blocks within six months, Parakh said reacting to court verdict. He asked why no investigation was carried out against those who prevented implementation of a transparent allocation system.

‘The Supreme Court has cancelled all the blocks except four. I believe that the blocks cancelled will
be re-allocated and if present holders are given the first right of refusal then there would not be
much dislocation of work. If there is a wholesale change and new people come, it would have a very severe impact,’ the former Coal Secretary said. 
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