That the Prime Minister’s Office has had to step in to resolve the differences between the Union Ministry of Environment and Forests on the one hand and the Union Ministries of Coal and Power on the other over the mining of coal in forest areas, shows the critical level that the issue of coal shortage has reached in hampering the operation of the country’s various power plants. At a high-level meeting earlier this month, Prime Minister’s Principal Secretary Pulok Chatterjee instructed the Environment and Forests Ministry to look into the possibility of allowing an additional 25 per cent of coal to be mined without the Ministry having to issue any new clearances or permits. Around 70 per cent of India’s power is sourced from coal and optimal coal mining is the key to sustaining India’s economic growth. However, over the past few years, the Union Ministry of Coal and the Union Ministry of Power have claimed that the Environment and Forests Ministry has been withholding clearances for mining in forest zones, leading to a serious drop in coal production. If this dispute is not sorted out at the earliest, India will find itself on the brink of an energy crisis. If the country is to continue on the road to economic development, it can’t do so without the power it derives from its coal deposits. Take, for instance, the fact that since March 2009 Coal India Limited — the country’s largest state-run mining agency — has refused to sign any new Fuel Supply Agreements because it apprehends that it will not be able to fulfill its commitments. The agreement is a legally binding document that requires CIL to supply at least 90 per cent of the contracted volume of coal; or else it can be dragged to court. Given that CIL had no growth in 2010 and registered a negative figure in 2011, its refusal to sign any new FSAs is understandable — although its impact on industry has been alarming. Instead, the coal giant now has memorandums of understanding with its new clients which require it to supply only 50 per cent of the promised volume. But this doesn’t resolve the problem of demand and supply that lies at the root of the problem.
It is nobody’s case that environmental concerns should be ignored for the sake of economic growth — such development would be unsustainable in the long run anyway, and advocating this approach for short-term gains is only proof of a myopic policymaking. For far too long, environmental clearances have been taken for granted and unrestricted damage to the environment has been inflicted in the name of economic development. There is now a growing realisation that the conservation of environment and economic growth can go hand in hand, if only the Government can provide clear policy guidelines rather than lurch from one dispute to another.
