Tag: Coalgate

The similarities between the Coal Scam and the @2G are so similar that it can be safely assumed the that 2G was a trail run to perfect the art of stealing from the exchequer without being accountable, hiding behind ‘notes’ bypassing the channels and keeping the Committee on the auction of the  Coal for five years, while the allocation spree was indulged in.

Consider these facts.

Like Telecommunication, Coal is a Union Subject.

2 G had an ally heading the Ministry, with Congress holding the Minister of State slot.

2 G had Murasoli Maran ,later A.Raja as the Telecom Ministers.

Coal had Shibu Soren as the Union Minister of Coal and Dasari Narayana Rao as Minister of State.

As in 2G,  ” the draft Cabinet note proposing auctioning of coal blocks, prepared on the instructions of the PM, was amended about half-a-dozen times, ostensibly to address the concerns of those who were opposed to auctioning. But each time the note was amended, a new litany of objections were raised”.

A convenient ploy for the Prime Minister to defend himself later by saying he ‘instructed’ to follow the rules!

In the case of the 2 G there was no objection to allocation from the States, while there were objections from the BJP ruled States,from Vasundhare Raje Scindia and Chattisgarh, which of course, were ignored.

So was the objection by Murli Manohar Joshi  in his letter dated 2 December 2007 and later as the Head of The Joint parliamentary Committee ,just as Sushma Swaraj has done in 2G.

Not that the Regional satrap Soren was The Minister for Coal and stooges of Karunanidhi of DMK for Telecom.

In the early days of 2G, TRAI and Ministry of Telecom advised for auction , pointing out the market value of the Service.

In the case of Coal.it was , then coal secretary PC Parakh 9at the time of UPA-I)

Following Parakh’s vehement opposition to this method, the UPA announced the auction policy in 2004 but didn’t operationalise it until 2010

“Parakh had informed the PM that the extant system under which a screening committee headed by the coal secretary with representatives from various ministries, State-owned corporations and state governments allocated captive coal blocks, was arbitrary, opaque and prone to corruption. More importantly, he told the PM that there was a substantial difference between the price of coal supplied by Coal India Limited and the cost of coal produced through captive mining, and thus, parties with captive blocks were making windfall gains.’

On 28 June 2004, Parakh, in a consultative meeting with stakeholders, including industry and consumer forums, made a strong pitch for linking the allocation of coal blocks with a market-driven economy. Between 1992 and 2004, on an average, three or four captive coal blocks were allocated to major steel, cement or power companies every year through the screening committee system.”

Non serious players, as in 2G, had entered the field like Jagathrakshakan’s J’R’Power P.’ltd which was five days old when it signed an MOU with Puduchery Investment Corporation(please read my blog on this).

As in 2G . the Coal Blocks were allotted at a fraction of the market price.

“while between 2004 and 2009, the UPA kept deferring the auction policy, it also went on an unprecedented allocation binge. As many as 155 precious coal blocks with billions of tonnes of coal reserves were allocated at a fraction of their true market worth in a span of five years (76 were allocated to private companies, and the rest went to public sector enterprises). The circumstances, as we will later see, suggest that this was done as per an elaborate conspiracy hatched between decision-makers and coal allottees.”

In 2G ,the BSNL was made to suffer while these shady Companies were brought in to make money ,in Coal

‘More than 80 percent of the allottees have not yet started producing coal from their respective blocks. This led to a bizarre scenario where on the one hand, the government acted with unprecedented haste in allocating these blocks, and on the other, it did precious little to ensure that the allottees started producing coal from their respective mines and used it for the designated end use like producing power, steel, cement, etc. The government has now set up a committee to identify how many operators have deliberately defaulted in starting the coal production work and how many got stuck on account of bona fide delays in land acquisition, forest and environmental clearance or approval of mining plan. The biggest rationale of the government behind captive coal block allocation was to enhance domestic coal production capacity.”

“The draft report of the CAG has pegged the total loss of revenue from this misallocation between Rs 6.31 lakh crore and Rs 10.67 lakh crore. While the windfall gain made by private companies stands between Rs 2.94 lakh crore and Rs 4.79 lakh crore, TEHELKA has learnt from its sources that the final CAG report has pegged the undue gain made by private operators between Rs 1.5 lakh and Rs 2 lakh crore.”

The difference is the  size of the scam.

http://www.tehelka.com/story_main53.asp?filename=Ne110812Coverstory2.asp

Couple of things we noticed in 2G seems to be missing as i had indicated in my earlier blogs.

-Radia type operator.

-CAG Report came later ,after Radia tapes.

-Middlemen details

-the money  trail.

I am sure it will follow.

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Related articles

• The Beneficiaries of Coalgate Spread Among all? (ramanan50.wordpress.com)