ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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The Coal Saga

The Imminent and the Feasible

Pricing, entitlements and allocation need to be looked at carefully in the coal sector if the present mess has to be sorted out. This article proposes certain measures which can break the impasse and argues for a break-up of Coal India into smaller units as a possible solution.

The authors are grateful to Raghuram Rajan and Varad Pande for feedback. Views expressed are strictly personal.

If reviving growth is a top priority, then fixing the power sector, and thus as a corollary the mess we face in coal deserves an imminent primacy in the list of policy decisions that need to be fast-tracked. A budding entrepreneur from Bihar told us,

You may think that labour laws or even lacking basic infrastructure are responsible for stifling industry, but let me tell you that the single biggest reason is power. I run my plant on diesel, it is not scalable at all.

As we found out in our interactions, he is definitely not alone in the thirst for power.1

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