Coal in the BJP States 4

MADHYA PRADESH
While the UPA has pointed fingers at other states, they have conveniently left out
BJP-led Madhya Pradesh, which actually conducted auction. The government would do
well to learn from this state. Here are some lessons-
1. In November 2008, the Madhya Pradesh State Mining Corporation auctioned 6 mines.
This auction saw 152 bids made by 62 different companies.
2. The government retained control of the mines by entering into a Joint Venture with
the private companies — MPSMC held 51% share in the JV.
3. No government guarantees for the amount invested by the private companies.
4. The coal blocks were auctioned off for Rs. 700 to Rs. 2100 per tonne. This is several
times higher than what the CAG has estimated — Rs 295 per tonne. Going by by this
number, the loss estimated should be even higher.
Though Madhya Pradesh has done all it could to maximise revenue for the people
(instead of politicians), it is the Central Government that is proving to be a hindrance by
stalling environmental clearances.