Union Budget 2013: PPP mode for raising coal production

Last Updated: Thu, Feb 28, 2013 08:06 hrs
India's Finance Minister Chidambaram attends a news conference in Hong Kong

Finance Minister P. Chidambaram Thursday said the public-private-partnership (PPP) model should be followed to raise coal production.

"One of the ways forward (to raise coal production) is to devise a PPP policy framework with Coal India Ltd as one of the partners in order to increase production to supply to power producers and other consumers," Chidambaram said in the annual budget speech to parliament.

He said such a policy was under "active consideration" and the coal minister would make the appropriate announcement.

Pointing out that coal imports were projected to go up to 185 million tonnes by the end of the 12th Plan period in 2016-17, there was no other option other than importing coal and adopting a policy of blending and price pooling for imported coal.

Price pooling of imported coal is under consideration of the ministry. As per the existing arrangement CIL has with consumers, the state miner follows the cost-plus method for imported coal.

Many state governments are not in favour of price pooling as it would affect power rates.

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