The controversy surrounding the report by the Comptroller and Auditor General of India (CAG) on the alleged Rs 10-lakh crore undue benefit to coal block allottees refuses to die down. In a stunning observation aimed at downplaying the potentially damaging findings of the government auditor, Finance Minister Pranab Mukherjee on Saturday said 90 per cent of the issues raised by CAG in the draft report are generally dropped, and do not find place in the final report.
“CAG is yet to finalise its report. It is the preliminary report. (The coal) ministry is to make a comment on it. After obtaining comments from the ministry, 90 per cent of the issues raised by the CAG are dropped. That is the normal practice and it is going on for last 150 years,” he said at an event organised by industry body Federation of Indian Chambers of Commerce and Industry.
In its draft report on ‘Allocation of Coal Blocks & Augmentation of Coal Production by Coal India’, CAG had said the exchequer had suffered a loss of Rs 10 lakh crore on “undue benefit” extended to companies by allotting them a scarce natural resource, virtually free of cost, between 2004 and 2009.
The issue disrupted proceedings in Parliament on Friday, with the Opposition attacking the government and forcing adjournment of the Lok Sabha and the Rajya Sabha till noon. Later, the Prime Minister’s Office (PMO) released extracts of a letter from Comptroller and Auditor General Vinod Rai where he stated the report was “very preliminary”. The final report is likely to be placed in Parliament in the current session after the recess.
Mukherjee also stressed it was the job of the CAG to search for faults with the working of the government. He added the CAG himself had explained the whole issue in his letter to Prime Minister Mamohan Singh, and that no further explanation or clarification was needed on the same. “CAG’s job is to find the fault and not to praise the government or certify that the government has done a good job. So, what is new if irregularities are found in a CAG report? Those irregularities have to be addressed by Parliament. It will go to the Public Accounts Committee,” he added.
Coal mining is an exclusive domain of the public sector in India. To allow restricted entry of private players into the coal mining space and boost production, the government has been allocating coal blocks to companies for captive use. A total of 40 blocks were allocated between 1993 and 2004. The UPA government, which came to power in 2004, found the allocation process lacked transparency and introduced changes, including due consultations with state governments and ministries concerned.
To inject further transparency into the process, the UPA-II regime started discussions over a proposal to introduce bidding for all future allocations in 2009. Since then, not a single coal block was allocated to any company. Only 28 of the 193 blocks allocated between 1993 and 2009 have started production. Last year, the coal ministry had cancelled 24 allocations citing delay in development.
India faces chronic coal shortage, as the annual domestic production of 530 million tonnes (MT) falls short of demand by over 80 MT, which is met through imports.
