Singareni Collieries Company Ltd (SCCL) was a wholly-owned State public sector undertaking until 1960 when the then erstwhile Andhra Pradesh government transferred a 49% stake to the Centre for mobilising funds for the expansion of coal mining. File
| Photo Credit: The Hindu
The 10th round of the Commercial Coal Blocks auction, initiated by the Ministry of Coal on June 21 to privatise 67 blocks across eight States, includes the Shravanapalli coal block in Telangana’s Mandamarri mandal. Estimated to contain approximately 120 million tonnes of coal, this auction has sparked a fresh round of political debate among the State’s major parties.
The Opposition Bharat Rashtra Samithi (BRS) opposes the auction of coal blocks in Telangana, arguing that the State government, should allocate coal mines through nomination. However, the argument has not gone down well with the Union governments. The auction was mooted by the UPA-II government in 2013 and subsequently pursued by two terms of the NDA government on the pretext of making India ‘atma nirbhar’ (self-reliant) in coal production as the country had been importing huge quantities of coal despite having reserves.
The auction of coal blocks is intended to allow private companies to take up mining after successful bidding and exploit the mineral on a commercial basis by offering a percentage value of coal sold to the government. The successful bidders will get leasing rights from the State governments.
Coal mining in Telangana dates back 140 years, with the establishment of the Hyderabad (Deccan) Company Ltd in England in 1886 initiating coal extraction. Later, Singareni Collieries Company Ltd (SCCL) was established in 1920 and the majority stake (holding) in it was purchased by Hyderabad in 1945. It continued to be a wholly-owned State public sector undertaking until 1960 when the then erstwhile Andhra Pradesh government transferred a 49% stake to the Centre for mobilising funds for the expansion of coal mining.
Despite occasional losses, SCCL, a profitable State PSU, has extracted approximately 1,753 million tonnes of coal from underground and opencast mines by the end of the 2023-24 fiscal year.
Telangana has a total of 82 coal blocks with over 3,000 million tonnes coal reserves and of them only 39 are with Singareni and one with TG-Genco.
The Centre has identified four coal blocks for auction in Telangana— Koyagudem, Sattupalli Block-3, Shravanapalli Block-3 and Kalyanakhani Block-6 — to begin with. The Koyagudem block had received only one bid and as a result it was not allotted. The other three mines too were offered in the auction in the past but there were no bidders. This time around, the Coal Ministry has listed Shravanapalli again.
The previous BRS government had instructed the SCCL management not to participate in the coal blocks auction, protesting the Centre’s policy of allotment of coal blocks only through tenders. It is not clear whether the incumbent Congress government would follow the same. The BRS had written to the Centre and Prime Minister Narendra Modi for the allotment of coal blocks to Singareni on a nomination basis and the then-Pradesh Congress Committee president, A. Revanth Reddy, present Chief Minister, also did the same.
Working president of BRS, K.T. Rama Rao, has alleged that the Centre was conspiring to privatise SCCL by divesting its stake in the company by regularly denying coal block allocations until the company incurs losses. “Now that its key partners TDP and Jana Sena have won 18 seats, it could go slow. In Telangana, people have given 8 seats each to the BJP and the Congress party but they too have colluded in the matter of coal blocks’ auction”, he said.
The BRS’ argument for allotment of coal blocks to Singareni has ample ground as the Centre had allotted two lignite blocks each in Odisha and Tamil Nadu and five coal blocks in Gujarat to State public sector companies due to pressure from the State governments or parties.
Chief Minister A. Revanth Reddy has faulted the previous BRS government and criticised it for handing over a coal block allotted to TG-Genco to a private company. The BJP leaders are arguing that the auction was to improve revenue through royalty to the State government. Irrespective of the parties blaming each other, it is to be seen whether they could stop Telangana’s coal mines from falling into the hands of private companies and secure mine allocations for Singareni through nomination. This is a million dollar question for now.
