Government with no moral authority can't ask CIL to raise output: Narsing Rao

In a bitter criticism uncharacteristic of a head of a public sector company, Coal India (CIL)’s  chairman and MD Narsing Rao (pictured) has chided the government, the firm’s parent, for asking the latter to significantly raise its output.

The government has lost “moral authority” in doing so, he said. For, it is a declared policy that national coal output can be raised only by allocating new coal blocks, mostly to the private sector.

“If the government could decide some years ago that Coal India could produce only 520 million tonne and no more, and follow an alternative way to raise country’s coal production by allocating mines to public as well as private sector companies, then all I can say is that the government has lost the moral authority to expect Coal India to produce anything more than that,” Rao told a gathering of employees and board members on the occasion of the company’s foundation day on Friday.

If taken together with alleged scandalous coal block allocations, Rao’s remarks assume significance,  industry observers said.

Rao also took exception that “everybody” expects Coal India “to come to the rescue every time there is a crisis” (like coal shortage).

Rao was also bitter about Coal India not being given the importance it deserves. ‘’There is criticality attached to the coal sector and it is expected that all the important players in the government would provide encouragement and active participation in our endeavour... and not just make us the whipping boy,” Rao said. “An organisation that contributes close to 1% of the country’s GDP surely deserves attention, help and cooperation from the central government, state governments and other stakeholders…but what we get is brickbats rather than encouragement.”

Several of Coal India’s mining projects are stuck in long delays of clearances and infrastructural bottlenecks like absence of rail links to mines. ‘’The problems are well known but the focus is on the manifestation of the problems, not the causes,’’ Rao said.

Despite such hardship, Rao said, Coal India has more than fulfilled its duty towards the nation.
“Last year, electricity generation grew by 4% in the country while coal-based power generation grew by 12.7%, and out of that, 11% growth came from Coal India. One can image if tour growth were at a historical rate of 5-6%, what would have been the power generation situation and the resultant impact on the economy.”  

Rao’s outpouring might prove ill-timed given that the government is readying to sell some of its holdings in Coal India to local as well global investors. But it nevertheless highlights the constraints and an adverse environment within which the country’s core sector operates, said experts.