What are the practical alternatives?
On-going power projects to suffer?
This is done after ?an earlier judgement that allied the coal allocations arbitrary and illegal. Now, the apex court followed it with the natural consequence of declaring the major allocations as unsustainable and the court also imposed fines of Rs.295 per metric ton of coal extracted so far by the illegal mine owners. The government would get revenue from this fine about Rs.10,000 crores.
This decision of the apex court ?was not what the industry wanted. They had already got away with the illegal allocations. It is also ?very late in the day. These allocations were done long ago, from 1993 onwards.
In the cases like 2-G and coal blocks allocation, the ‘crime’ committed is serious and also long ago. Once the crime is detected and the investigations and court proceedings and the final judgements come, the time lost is too long. People’s memories are proverbially short and the money was stashed away in tax havens and the beneficiaries are too many. Often, it is only whispered in low voices the names of beneficiaries.
Who are the beneficiaries in the 2-G loot? There are so many names you can?t even whisper!
Likewise, the coal block allocations, the beneficiaries ?are no small fish. In ?fact, they are the very big fish! We need not name them here.
The Economic Times in its editorial says this is a very erroneous conclusion, the judgement. In the sense, it comes after 20 years of transactions. The court went by the new government’s assurances that it would manage things even if the producing blocks allocations are cancelled.
That is who 38 producing blocks are also cancelled.
Is this wise or pragmatic by the way? Six more companies are ready to mine the coal but now included in the cancelled list.
What about the businesses in progress?
What about the banks that had lent funds for these companies?
The ET calls this judgement as one that has very many bad consequences, it would ?wreck investors confidence”.
Out of the 46 companies, he court had held that only four can run and the four, two are PSUs, so it is okay, the others are big ones with heavy investments and large stakes from several points of view. Banks have an exposure to the extent of about Rs.73,000 crores are likely to be greatly adversely impacted.
One suggestion is to scrap the very coal nationalisation law of 1973,done under Indira Gandhi when her former Communist member Mr.Mohan Kumaramangalam was the coal minister.
Break up the Coal India and privatise the mines so that merchant mines become the norm. Let the market prices be charged and let auction or any other more transparent manner the natural resources be allocated.
The point is that first, the governments of the day are pulled in several ?directions and the big fish get away with choice allocations. It takes years before such an illegal ?action, allocation had happened. Once you detect and come to the court the time is too long.
Plus you add the oligarchical, crony style capitalist classes are active in collusion with the political classes.
You know the names. Some are sitting MPs and some others active polticians. Nagpur has become the centre of this gross illegality.
The unsaid part of the story is the governments of the day and their obliging bureaucrats wink at the happenings.
Then, you have to wait for a long time ?for the Messiah in the form of a Vinod Rai to come out with the exposure.
But then, it is too late in the day.
The present judgement, while welcome, is only ?a poor consolation for the common man.
Money had been made in a massive scale, Vinod Rai is again our guide.
One thing seems certain. The 2-G and coal gate are the two blots on the UPA-II government.
They not only lost their face, the elders, and the country also paid a heavy price in the loss of revenues and also in the economic growth rate.