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Showing posts with label Narendra Modi Government. Show all posts
Showing posts with label Narendra Modi Government. Show all posts
India's economic growth in FY'17 is expected to be driven by consumption growth due to the impending pay revision of government employees. This would reverse the trend of FY'16 in which growth has been largely investment driven, said a report by British Bank Stanchart.

"We expect consumption to drive India's GDP growth in FY17 (year starting April 2016), taking over from investment," say Mr. Saurav Anand and Ms. Anubhuti Sahay of South Asia Research at Stanchart in their report. "Impending pay rises for public-sector employees, to be implemented from FY17, are likely to partly redirect the government's limited fiscal resources from investment to recurrent spending that will boost consumption."

While higher government spending on salaries will benefit consumption, the diversion of resources is likely to slow India's investment recovery, which has been driven entirely by government capital expenditure. This is going to impact the fiscal numbers according to the writers. "We expect the fiscal burden to be borne mostly by the central government, as it will implement the pay revisions in the first year (FY17), when it also aims to reduce the fiscal deficit by 0.4 percent of GDP to 3.5 percent of GDP."

The amount and details of the pay revisions - which are implemented once a decade - are expected to be finalized and announced by end-2015. Assuming a 15 percent hike in public-sector pay and pensions, we estimate total additional recurrent expenditure of 1.2 percent of GDP by the central and state governments over the next three years. This is likely to boost consumption. The impact in FY17 is likely to be limited to 0.7 percent of GDP, as states usually stagger the pay revisions over two to three years.

Urban consumers are likely to benefit the most from the pay rises, leading the consumption recovery in FY17. While urban consumption improved in H1-FY16, deteriorating rural demand has caused consumption to stabilize at low levels, putting the onus on investment to drive growth this year. Low inflation and the lagged impact of lower interest rates are also likely to boost urban demand, particularly for autos and white goods, in FY17. Rural demand is likely to improve if monsoon rains return to normal after three seasons of unfavorable weather conditions.

States' capacity expansion should hold up better given the staggered implementation of pay revisions and more fiscal headroom at the state level, according to the report. Since the private sector is unlikely to plug the gap created by slower central government investment, the pace of investment is likely to slow unless the central government slows the pace of fiscal consolidation. It aims to reduce the fiscal deficit to 3.5 percent of GDP in FY17 from 3.9 percent in FY16.

(Source – The Economic Times, 19-November-2015)
India's economic landscape is expected to undergo a major transformation over the next decade and is likely to achieve an average growth rate of around 8.8 percent, a Dun & Bradstreet report says.

According to the report, this increase in growth rate would culminate into high per capita income over the years.

"We believe India has the potential to achieve a higher growth rate, given its domestic fundamentals, D&B said in a report titled 'Manufacturing India 2025' which outlines the country's growth journey during the next decade. We expect India to realize its potential and achieve an average growth rate of around 8.8 percent during the next decade," it said adding that with this, India's nominal GDP is expected to touch $3.4 trillion by 2019-20 fiscal and further to around $7.0 trillion by 2024-25 fiscal.
The report, however, cautioned that in case of a delay or failure to implement key policy reforms, nominal GDP might reach to $6.2 trillion by 2024-25.

The new mode of governance, a pro-business policy framework, improved business environment through simplifying processes, focus towards decentralized planning and greater empowerment of states, the demographic dividend and the rise of the middle class have enabled India to emerge as one of the global economic powers on the world map, the report said.

The report further said while services sector would continue to drive India's growth momentum, the industrial sector is expected to witness double-digit growth.

Along with 'Make in India' Programme, other initiatives such as Digital India, developing Smart Cities and urbanization if implemented conscientiously will change the dynamics of Indian economy in next decade, Dun & Bradstreet India Senior Economist Mr. Arun Singh said.

The report further said the goal of raising the share of manufacturing to 25 percent of GDP would require conducive business environment, investment to support innovation, capital and labor efficiency amongst other measures.

Besides improvement in industrial and ICT infrastructure, strong supply chain and competitive infrastructure, focus on health and skill development are required which will not only support industrial development but also other segments of the economy, it added.

(Source – Assorted with the Inputs from PTI)

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As much as Rs. 40,000 crores could be saved by promoting cargo transportation by enhancing coastal shipping in 10 years under the ambitious Sagarmala project, a
port-led development scheme, as per government estimates.

Sagarmala is an ambitious project to promote port-led direct and indirect development of coastal states and to provide infrastructure for transporting goods via ports quickly, efficiently and cost-effectively.

"Higher coastal shipment of coal by 100 million tonnes per annum (MTPA) and higher coastal shipment of other commodities (cement, steel, fertilizer, food grains, POL) by 50 MTPA" alone could result in savings to the tune of Rs. 11,500 crores by 2025, an official document on Sagarmala has said.

Building of new coastal capacities for 120 MTPA steel and cement in southern Gujarat, Central Andhra Pradesh, northern Karnataka, Odisha and northern Andhra Pradesh would result in savings of another Rs. 8,500 crores, it said.

According to the document, another Rs. 12,500 crores could be saved in the next ten years by reducing time to export container by 5 days through customs efficiency and last mile connectivity by building dedicated road corridors.

Apart from these, the government plans saving Rs. 7,500 crores by increasing "share of railways in modal mix from current 18 percent to 25 percent, creating "transshipment hub at Southern tip" and building "three new container ports" at Vadhavan, central Andhra Pradesh and Sagar. It said these will reduce the cost to export by Rs. 3,000 per container.

The government last month has announced to spend Rs. 70,000 crores on development of major ports only which have received 104 suggestions from international consultants to increase efficiency.

Once implemented, this will result in cargo traffic increasing three-fold while the ports will also go under performance audit.

Last month, Road Transport and Highways Minister Mr. Nitin Gadkari has said, "Mahanadi Coalfields Ltd in Odisha is expanding its output capacity to 260 million tonnes from the present 60 million tonnes and if the coal is transported through water, this will save Rs. 7,000 crores annually."

He has said two ports - Kandla and Paradip - were being developed into Green smart cities and the government is eyeing at Rs. 4,500 crores profit from ports this fiscal.

Mr. Gadkari has said the Prime Minister's emphasis is on "cooperative federalism" and Chief Ministers of states like Andhra Pradesh, Goa, Tamil Nadu, Karnataka, Maharashtra, Gujarat and Odisha, who attended the first meeting of Sagarmala had come out with many good proposals.

He has said 13 states and union territories were involved in Sagarmala initiative which will be implemented across India's 7,500 kms coastline.

In March, the Cabinet had given 'inprinciple' nod to the project, aimed at port-led development in coastal states.

(Source – Assorted with the Inputs from PTI)

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India’s gross domestic product (GDP) likely grew around 7.3 percent in the July-September quarter, up from 7 percent in the first quarter of FY16, but it remained below the country’s potential, Moody’s Analytics said on Friday.

Though India’s potential is around 9-10 percent GDP growth, it said closing the negative output gap is dif-ficult as external headwinds are blowing stronger and the government has failed to deliver promised reforms.

“We believe GDP will grow at 7.6 percent this year and in 2016,” it said. Key economic reforms including in land acquisition, a national goods and service tax, and revamped labor laws, would help the country deliver higher GDP growth, it said. The World Bank on Thursday retained growth forecast for India at 7.5 percent for this year citing a pick up in investment due to higher capital expenditure by the Centre. In-dia’s GDP grew by 7.3 percent in FY15.

However, Moody’s cautioned that getting the Rajya Sabha nod to some of the key reforms could get ob-structed by an “obstructionist” opposition as recent controversial comments from ruling-Bharatiya Janata Party members won’t help the government’s cause. The ongoing state election in Bihar-

On the other side, the Reserve Bank of India has helped kick-start the economic recovery by cutting the repo rate by 125 basis points this year. Banks have also started passing the rate cut benefits to consumers. Further rate cuts in 2015 are unlikely, Moody’s said.

While global market sentiment has been down, Indian equities have also suffered from a loss in domestic sentiment. Bank balance sheets are still reeling from the economic slowdown in 2013. Profits slumped earlier in the year, and nonperforming loans hit a 14-year high. Thus, banks have been reluctant to expand investment. This explains the little sign of an upward trend in credit growth this year.

There are also indications that investors have been less optimistic about India’s economic prospects. Net financial flows into equity were around $16 billion in
2014. However, they are unlikely to reach those highs this year. The same can be said about financial flows into India’s debt market. The RBI is consistently looking to improve India’s banking and financial structures. “We believe a move towards full capital account liberalization is inevitable in India. This will likely occur in the next two to four years. A freer capital account will give Indian companies greater access to overseas markets, lower borrowing costs, and facilitate credit growth—a key ingredient to increasing investment,” it added.

one of India’s largest and poorest states-could prove pivotal to (prime minister) Mr. Modi’s leadership, it said. A win, would help the ruling party secure a majority in the Rajya Sabha. Unlike in the Lok Sabha, the GST bill is held up in the Rajya Sabha as the government does not have a majority in the upper house.
  • Moody’s Analytics Says
  • Low interest rates will buttress Indian economy in the short term, but reforms are needed to reach long-term potential growth.
  • Better political outcomes could help India achieve reforms
  •  Financial market sentiment has faded; the stock market and foreign inflows are down
  • External headwinds are growing stronger and are hurting India’s exporters
  • Further rate cuts in 2015 are unlikely, but there is room for more next year.

(Source – The Financial Express, 20-October-2015)   
India has moved up one position to become the world’s seventh most valued ‘nation brand’, with an increase of 32 percent in its brand value to USD 2.1 billion.

The US remains on the top with a valuation of USD 19.7 billion, followed by China and Germany at the second and the third positions respectively, as per the annual report on world’s most valuable nation brands compiled by Brand Finance.

The UK is ranked 4th, Japan is at fifth position and France is sixth on the list. While India and France have moved up one position each since last year, all the top-five countries have retained their respective places. However, the surge of 32 percent in India’s ‘nation brand value’ is the highest among all the top-20 countries on the list.

China has retained its second position despite a decline of one percent in its brand value to USD 6.3 billion. Brand Finance said it measures the strength and value of the nation brands of 100 leading countries using a method based on the royalty relief mechanism employed to value the world’s largest companies.

The nation brand valuation is based on five year forecasts of sales of all brands in each nation and follows a complex process. The Gross domestic product (GDP) is used as a proxy for total revenues.
The report also said that India’s ‘Incredible India’ slogan has worked well, while Germany suffered due to the Volkswagen crisis. About the US, the report said it remains a powerful brand with an inviting business climate.

“However its value comes in large part from the country’s sheer economic scale… The US’ world-leading higher education system and the soft power arising from its dominance of the music and entertainment industries are significant contributors too. This soft power will help the US to retain the most valuable nation brand for some time after China’s seemingly imminent rise to become the world’s biggest economy,” it added.

The study further said that China’s recent stock market turbulence and slowing growth will also extend the US’ tenure of the top spot. Among the BRICS nations, India is the only country to have witnessed an increase in its brand value with all others – Brazil, Russia, China and South Africa – seeing a dip in their respective brand valuations.

India is the second most valued among these emerging economies after China, followed by Brazil, Russia and South Africa.

(Source – Assorted with the Inputs from PTI)

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Keeping its projections for India and China unchanged, the International Monetary Fund on Thursday forecast that India will grow a clip faster at 7.5 percent in 2015 and 2016, overtaking a slowing down China.

While India's GDP growth would go up from 6.9 percent in 2013 and 7.3 percent in 2014 to 7.5 percent over the next two years, China would slow down from 7.7 percent in 2013 and 7.4 percent in 2014 to 6.8 percent in 2015 and 6.3 percent next year, IMF said.

The July update of the April 2015 World Economic Outlook (WEO) predicting a slower growth in emerging markets and a gradual pickup in advanced econo-mies projected global growth at 3.3 percent in 2015, marginally lower than in 2014.

In 2016, growth is expected to strengthen to 3.8 percent, the report said attributing the small onward revision to global growth for 2015 to a setback to activity in the first quarter of 2015, mostly in North America.

Nevertheless, the underlying drivers for a gradual acceleration in economic activity in advanced economies "easy financial conditions, more neutral fiscal policy in the euro area, lower fuel prices, and improving confidence and labor market conditions" remain intact, the report said.

In emerging market economies, the continued growth slowdown reflects several factors, including lower commodity prices and tighter external financial conditions, structural bottlenecks, rebalancing in China, and economic distress related to geopolitical factors, it said.

Growth in advanced economies is projected to increase from 1.8 percent in 2014 to 2.1 percent in 2015 and 2.4 percent in 2016, a more gradual pickup than was forecast in the April 2015 WEO.

The IMF also maintained its forecasts for a pickup in growth in the euro zone, despite Greece moving ever closer to the edge of default and an exit from the currency bloc as it races to find a last-minute third bailout. "Developments in Greece have, so far, not resulted in any significant contagion," the IMF said. "Timely policy action should help manage such risks if they were to materialize."

The unexpected weakness in North America, which accounts for the lion's share of the growth forecast revision in advanced economies, is likely to prove a temporary setback, the update said.

Growth in emerging market and developing economies is projected to slow from 4.6 percent in 2014 to 4.2 percent in 2015, broadly as expected. In 2016, growth in emerging market and developing
economies is expected to pick up to 4.7 percent, largely on account of the projected improvement in
economic conditions in a number of distressed economies, including Russia and some economies in
the Middle East and North Africa.

The projected pickup in global growth, while still expected, has not yet firmly materialized, according to the WEO update.

Raising actual and potential output through a combination of demand support and structural reforms
continues to be the economic policy priority, the report said.

Efforts at implementing structural reforms remain urgent across advanced economies, both to tackle
crisis legacies and to raise potential output.

In emerging market and developing economies, macro-economic policy space to support demand is generally more limited but should be used to the extent possible, the report said.

Structural reforms to raise productivity and remove bottlenecks to production are urgently needed in
many economies, the update suggested.

(Source – IANS, 09-July-2015)
On the second day of the ET Global Business Summit (GBS), senior ministers of the Narendra Modi government provided details of their plans to back the prime minister's vision of upgrading India from a $2 trillion economy to a $20 trillion one. A day after Modi, as chief guest at the summit, outlined the vision, railways minister Suresh Prabhu and information technology and information minister Ravi Shankar Prasad made it clear that they wanted to overhaul their respective ministries and undertake a generational leap rather than carrying out incremental changes.

Attracting investment to expand the capacity of the railways which faced a cash crunch and ensuring digitization of government services for people who lived in the remotest corners of India were priority for the new government.

On Friday at the GBS, Modi had said that the country was making the transition from a "winter of subdued achievement" to a "new spring". He had also asked why India could not dream of making the transition from a $2 trillion economy to a $20 trillion one.

All in Support

The prime minister's ambition was repeatedly referred to by the ministers as well as representatives from some of the largest global and Indian companies. Prabhu reminded the audience that a slogan was a must before undertaking a major overhaul or even leading a movement for governance reform from within. He said the "Quit India" slogan given by Mohandas Karamchand Gandhi in 1942 and Subhash Chandra Bose's urging countrymen to shed the martyr's blood in return for freedom had played a significant role in India achieving independence. Lauding the prime minister for setting ambitious targets, Prabhu said that only a slogan that would resonate with people would trigger a movement which finally would lead to the achievement of a target.

Getting Back on Track

The minister pointed out that though the railways could make a huge contribution to the economy, its inability to invest in expanding capacity had ensured that the national transporter remained stuck in a vicious cycle of under-investment which in turn affected its ability to earn. The minister also said that the operating ratio of the railways was a major challenge.

"Investments in railways could boost the Indian GDP up to 3% in the next five years, apart from bringing in social benefits," said Prabhu.

Stating that there is no dearth of investors, the minister said that pension funds in Australia and Canada could be tapped to invest in railways provided a policy environment is created.

"If we want to increase the railway network by 30,000 to 40,000 km, we will need a huge investment. Also, we want to take the railways to the Naxalite-affected areas," he said. The minister hinted that a number of policy reforms may figure in his first Railway Budget to be presented next month, but refused to divulge the details. On the prime minister's call for making India a $20 trillion economy a day earlier in ET GBS, Prabhu said: "PM has already given a clear vision. I can just say: Yes, I will do".
Yes, We Can

The minister also emphasized that it was important to formulate policies that are ambitious and easy to implement at the same time.

Minister for telecom and information technology Ravi Shankar Prasad reiterated the importance of the government's Rs 1.13 lakh crore Digital India program which aims to offer government services to all Indians online and through smartphones by 2019.

The minister said the government will connect 250,000 gram panchayats within three years through the National Fibre Optic Network. The first 50,000 of these will be connected within this year under the Rs 20,000-crore project.

The minister said the government would strive to bridge the gap between the digital "haves" and "have-nots" and said such projects that centred on e-services would benefit the poor the most. "There will be pressure on governments to deliver through electronic delivery of services," he said.

There was also a huge urge among the people of the country to get digitally connected. The huge number of suggestions and feedback that the mygov.in portal receives is evidence of this, he said. The portal received over 7 lakh responses when suggestions were asked on cleaning the Ganga and on environment protection. Similarly, when a contest for designs for New Year e-greetings was announced, the portal received over 3,000 designs within a week.

Meanwhile, the government intends to ensure adequate availability of spectrum in the upcoming auction and beyond, as it is aware of the challenges that lack of the natural resource poses for the growth of the industry.

"What was pending with defence for the last seven to eight years has been cleared," Prasad said.

The comments come amid criticism from the industry and experts that the government is putting a limited amount of spectrum in the upcoming February auctions which will create artificial scarcity and push up prices for airwaves, in turn increasing the sector's debt to over Rs 300,000 crore.

In a special address, Union minister of state (independent charge) for power, coal and new & renewable energy Piyush Goyal said the government has no business to be in business. "The job of the government is to facilitate business so that no impediment comes in the way [of investment]," he said. He appealed to the captains of Indian industries to invest big time in India. "The whole world will invest in India only if Indians start investing in India," he said.

At a 'Make in India' session, DIPP secretary Amitabh Kant spoke about the government's thrust on industrial corridors and how those will transform the logistic business in India. "The container movement between Delhi and Mumbai now takes 13 days. Once the DMIC is built, it will take just 13 hours," Kant said.

(Source: The Economic Times, Jan 18, 2015)
In compliance with the Supreme Court directive, power, cement and steel companies holding captive coal-producing blocks have forked out Rs 6,108 crore, at Rs 295 per tonne, towards penalties imposed till now on the mines.

While this huge non-tax revenue has come as a boost for the government seeking to prune twin deficits, it poses further financial pressure on companies including Hindalco, Jindal Steel & Power, Monnet Ispat, Usha Martin, CESC and Prakash Industries that figure prominently in the list of 18 companies that have remitted penalties till December 31, 2014.

The Supreme Court had cancelled the allotment of 204 out of 214 coal blocks in September last year, terming their allocation made since 1993 as “illegal". The court had imposed a penalty of Rs 295 per tonne on coal mined from 42 captive blocks. About 37 blocks were already producing coal while another five were to become operational when the Supreme Court directive came.

The court had also directed the power and steel companies holding coal blocks to make payments towards penalties before December 31, 2014.

Most companies have coughed up the penalties, as it was a pre-condition to participate in the coal blocks’ e-auctions, to be completed by end of this fiscal.

“We have received over Rs 6,108 crore as levy from owners of producing coal blocks. Most companies have come forward to pay the levy as this was a pre-condition for their participation in the auction process,” coal secretary Anil Swarup told Financial Chronicle.

The Supreme Court has extended the deadline to June 30, 2015 to pay the penalties on coal produced from these mines after September 24, 2014.

Penalties totaling to Rs 6,108 crore paid by steel and power companies has come as a bonanza for finance minister Arun Jaitley ahead of his budget presentation later next month.

This will not only help government efforts to rein in fiscal deficit but also prune the current account deficit given that both direct and indirect taxes mop up have been below targeted levels.

The country’s fiscal deficit has already touched a whopping Rs 5,25,000 crore as of April-November, 2014. This translates to about 98.9 per cent fiscal deficit targeted for the entire financial year. The government has budgeted fiscal deficit at 4.1 per cent of GDP for current fiscal.

As per the list detailing penalties paid by the companies, Jindal Steel and Power Ltd and Jindal Power Ltd headed by Naveen Jindal have taken the biggest hit. Together, the two firms have paid Rs 3,089 crore as penalty on coal mined from Gare Palma mines in Chhattisgarh.

Similarly, CESC has paid Rs 996 crore on coal from its Sarshatoli mines, while Hindalco had to forego Rs 566 crore on coal from Talabira-I mine. Other companies that forked out penalties include Sunflag, RRVUN, Sova Ispat, Sarda Energy, BS Ispat, MPSMCL, Electrosteel, Usha Martin, Jai Balaji, KPCL, Topworth, Jayaswal Neco.

The companies that were given blocks for captive use can win back the mines through the auction once they have paid the additional levy. These companies will, however, have to bid aggressively to get back their respective mines as they cannot take the risk of running their operational power or steel plants without any fuel support.

The owners of operational captive coal blocks have extracted 330 million tonne (mt) of fuel cumulatively till September 2014. The annual production potential of 42 operational blocks was 90 million tonne.

“We expect good response from bidders in the forthcoming auction process as is also evident from the list of companies that have come forward to pay levy. The first list of blocks advertised for auction has already received more than 100 registrations,” Swarup said.

Experts said that the auction of coal blocks will streamline the government’s fuel allocation policy in future. But, several infrastructure companies are expected to come under pressure as they have already piled up heavy debt.

In September, the Supreme Court had quashed 204 coal blocks allotted since 1993. This sent shivers down the banking industry, whose exposure to miners, power and steel plants was estimated to be about Rs 1 lakh crore.

Immediately after the apex court verdict, the government decided to promulgate an Ordinance to commence the auction process for de-allocated coal blocks. As of now, about 101 out of 204 de-allocated blocks have been put up for fresh bidding by cement, steel and power sectors under a two-pronged mechanism of allotment and auction.

While coal blocks identified for auction will be open to all entities for placing their bids, only government companies would have the option of getting blocks under the allotment route where identified fuel source would be offered to them on payment of reserve price.

Of the 101 blocks, 65 mines would be auctioned while 36 other blocks will be directly allotted to state-owned companies. The power sector is being given priority in the process as the Supreme Court order had impacted roughly 24,000 MW power-capacity that were being set up with assured fuel from the captive coal mines. So, 63 mines from the initial list of 101 would be given to the power sector, while the rest would be for sectors like steel and cement.
(Mydigitalfc.com, Jan 12, 2015)
 Coal India Ltd, the world's largest producer, and state gas utiltity GAIL India Ltd today signed agreements to invest Rs 9,000 crore in a plant to convert coal into gas and use this fuel to manufacture fertiliser. 

CIL and GAIL along with Rashtriya Chemicals and Fertilizers (RCF) and Fertilizer Corp of India Ltd (FCIL) will set up the integrate coal gasification cum fertiliser and ammonium nitrate complex at Talcher in Odisha by 2019, Fertiliser Minister Ananth Kumar said after the four firms signed joint venture agreements. 

The plant will be built by the two joint ventures - the upstream consortia for converting coal into synthetic gas or syngas, and downstream plant to manufacture urea and other fertilizers. 

GAIL will holds 35 per cent in the upstream venutre, called GAIL Coal Gas (India) Ltd. FCILwill take 11 per cent interest while RCF and CIL will pick up 3 per cent each each. The balance 48 per cent will be given to technology provider and financial institutions. 

The downstream venture, Talcher Chemicals and Fertilizers Ltd would be led by RCF and CIL with 40 per cent stake each while GAIL and FCIL will take 10 per cent apeice. 

The plant will manufacture 1.3 million tonnes of urea and other fertilisers annually, the Minister said. 

"India is deficit in urea production. Currently, we produce about 22 million tonnes of urea and there is a gap of 10 million tonnes. 

"By the time NDA completes its first term, India should become self-reliant," he said adding besides reviving Talcher plant, plans are afoot to revive units at Gorakhpur, Barauni, Sindri and Ramagundam. 

Oil Minister Dharmendra Pradhan said the upstream venture would cost Rs 3000 crore while the downstream fertiliser plant would be set up at a cost of Rs 6000 crore. 

Two coal blocks have been earmarked for the project - of these one has been allocated and the other has been kept as reserve, he said. 

The price of gas made from coal will be around USD 6.5 per million British thermal unit. This is compared to USD 5.61 per mmBtu price fixed for domestically produced conventional natural gas. 

Power Minister Piyush Goyal said use of coal gasification technology for production of fertilisers will lead to annual subsidy savings of Rs 3,000 crore. 

"We are working on reviving closed fertiliser plants using coal gasification or other cost effective technologies to increase the domestic production of urea. We aim to become a net urea exporter by March 2019," Kumar said.
(Source: The Economic Times, Dec 24, 2014)
The government is likely to allot eight coal mines to state-run Coal India Ltd from the 200-plus blocks on which mining permits have been cancelled by the Supreme Court in August. 

These eight blocks have total reserves of more than 2.3 billion tonnes, and include a premium mine with 1.5 billion tonnes of reserves previously allocated to Tata Steel for aRs 45,000 crore coal liquefaction project, a senior government official said. 

The Centre could also auction 21 blocks, including some big mines with more than 300 million tonnes of reserves, in addition to the 74 earlier identified for the first phase of biddings, the official said. 

A sub-committee set up to earmark coal blocks for allocation to government firms and auction to private companies has recommended allocating eight mines to Coal India and one to Singareni Collieries Company. "The committee has identified 44 additional coal blocks for auction in December that have obtained mining plans and have proven reserves. 

Narendra Modi government likely to allot eight mines to Coal India LimitedSome of these mines could start production soon with some efforts. The committee has earmarked 21 of these for auction, mainly to the power sector," the official said. "The Centre's aim is to increase output of Coal India Ltd and attracting private investors to the auction by offering good mines," he added. 

The panel recommended allotting the North of Arkhapal coal block, previously allocated to Tata Steel, to Coal India Ltd.The other blocks being considered for allotment to Coal India include three allocated previously to companies such as Hindalco Industries, JSW Steel,Jindal Thermal Power and Himachal EMTA, while the balance belonged to government companies like NMDC, Tenughat Vidyut Nigam and mining utilities of Madhya Pradesh and Kerala. Some of the companies were to jointly operate mines. 

The panel has recommended auctioning of North Dhadu with 924 million tonnes, Nakia I and II with 399 million tonnes and Icchapur block with 335 million tonnes of reserves.
(The Economic Times, Dec 3, 2014)
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