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CILs average annual growth rate may decline to 4.3% in current five year plan

06 Jul 2011 Evaluate

Coal India (CIL), world’s largest coal producer, is likely to register mere 4.3% average annual production growth rate during the current five year plan ending in March 2012. This would be the second-lowest growth rate in the last seven Plan periods since the beginning of the Fifth Plan in 1974. CIL has indicated that it would be in a position to supply only 331 million tonne (MT) as against a required 426 MT.

Coal ministry has blamed environment ministry for low production during current fiscal as former is unable to get consent for mining coal blocks already allocated to it. According to environment ministry it has certain areas which are classified as ‘No-Go’ areas and mining in these regions is believed to be destructive for country’s forest reserves. However, in such scenario the companies had requested alternate blocks in the vicinity of power projects but are yet to receive any revert from environment ministry. This delay affects the coal mining and the related power projects, thereby raising the cost.

Ultra Mega Power Projects (UMPP) “power for all”, due to the said issues, has become a distant dream which was expected to complete by 2012. CIL is bound by the Coal Distribution Policy which states priority based allocation. The coal consumers from private sector import coal from Australia and Indonesia. However, Indonesia in view of rise in demand from Indian companies has made recent policy change which mandates all coal exporters to sell coal at market prices; Australia is expected to follow the same or may restrict the exports.

Prime Minister concerned over the low growth rate has scheduled meeting with coal minister Sriprakash Jaiswal and environment minister Jairam Ramesh to discuss the said issue. The review meeting would focus on the progress made in the two sectors so far in the current Plan period and set a course-correction agenda for this year.

Coal India Share Price

438.70 0.00 (0.00%)
17-Apr-2026 16:59 View Price Chart
Peers
Company Name CMP
Coal India 438.70
NMDC 89.78
GMDC 733.40
Sandur Manganese 218.35
MOIL 327.60
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