ANNOUNCEMENTS
One of the prime objectives of India’s energy policy has been to provide access to energy to the entire population. Home to one-sixth of the world’s population and third-largest economy of the world, India accounts for only 6% of global energy use and one in five of the population, still lacks access to electricity. Unfortunately, the energy sector today in India is incapable to supply energy to the growing population. With abundant policy changes in the past decades though there has been a shift towards the free market economy, but unfortunately the energy sector is unable to meet the growing demand.
India stands amongst the top 10 countries having huge reserves of ore deposits. Despite this fact major portions of the mineral rich country remains under cover and unexplored. There has a been a constant decline in the mineral and resource production in the past years causing heavy revenue losses.
Coal is the primary source of energy in India. Also known as black gold, the coal sector in India has the history of not welcoming private players and operating under the state monopoly. With the drastically increasing demand for electricity, demand for coal is on rise. Yet this sector remains the most controlled and possibly least efficient of all energy sectors of the country.
In India 80% mining is carried on in the coal sector as it is one of the leading repositories of this black gold. Rest 20% mining consist of other minerals, fuels and metals.
With this humongous potential of reserves yet India is unable to realise it in the absence of the supporting factors. In spite of the long lease durations of 20-30 years and huge scope for employment and other factors of production, India lags behind because of various challenges that mining sector faces today. Factors like stumpy exploration expenditure, lack of foreign investments, illegal mining activities, deficiency of adequate infrastructural facilities and regulatory challenges have caused a major downfall of the Indian mining industry especially the coal sector. The inefficient institutional framework managing the governance of these coal mining activities reveals that there is a huge scope of launching new laws and policies for the mining sector. The companies carrying on mining activities continue to struggle with either low prices or land and environment clearance issues. For Instance, there are large number of coal mines which have been abandoned without proper closure and without any efforts of rehabilitating the area. Issues of transparency has always been there as one of the highlights of this sector. The order of quashing the allocated mines as arbitrary and illegal by Supreme court of India in 2014 is a clear case illustrating how mine allocations are actually done. The amended MMDR Act intends to legalise the system of auction of mines to enhance the transparency in mineral allocations in India. A transformed mining era is expected to be witnessed.3
India being the repository of huge coal reserves, fails to realise its potential to generate coal and meet the growing demand of the nation. There is a lot of questions raised on the existence of Coal India Limited as a monopoly in the coal sector in India and its incapability to address various challenges pertaining to the sector like lack of competition in the market, shortage in supply of coal, pricing issue, illegal mining and arbitrariness in allocation of coal blocks, discriminatory fuel supply agreements (FSA) and quality issue and other regulatory issues relating to environment clearances and land acquisitions.
Coal India Limited with its subsidiaries as a monopoly, is an undisputed fact but whether this monopoly is a dominant and negatively affecting the market is question to be examined. Whether restructuring of the coal sector with the introduction of an independent regulator and improving competitiveness in the market shall help the coal sector to meet the challenges and demands is a question to be answered There is a need to identify various stakeholders of the sector and the impact of the policies on them.
Policy changes introduced every now and then portrays the dynamic character of this sector and gives a broad scope to the researcher to test the legitimacy, transparency and impact of the new variations. With the lack of available literature giving a comprehensive picture of the entire legal framework of the coal sector there exist an inimitable opportunity to examine the regulatory mechanism within which the coal sector in India operates.
