SCREENING COMMITTEE DID NOT FOLLOW ANY RATIONALE IN DECIDING ON ALLOCATION

SCREENING COMMITTEE DID NOT FOLLOW ANY RATIONALE IN DECIDING ON ALLOCATION
The Prime Minister in his statement claimed that the selection for allocation through the
screening committee was a fair and transparent process. The fact is that it was not. This is what
the CAG has to say on the way the committee functioned (Para 4.1):
"It was also noted that the Screening Committee recommended the allocation of coal
block to a particular allottee/allottees out of all the applicants for that coal block by way of
minutes of the meeting of the Screening Committee. However, there was nothing on record in
the minutes or in other documents on any comparative evaluation of the applicants for a coal
block which was relied upon by the Screening Committee. Minutes of the Screening
Committee did not indicate how each one of the applicant for a particular coal block was evaluated.
Thus, a transparent method for allocation of coal blocks was not followed by the
Screening Committee."
What a hoax this process was is apparent from the fact that 58 out of 59 coal blocks allotted
to various private companies have not generated even one piece of coal since the operations
are yet to begin. Significantly, as soon as these companies publicized that they had been
granted mines, the value of their shares skyrocketed. Thus they made "windfall gains" even
before they started mining coal. In fact, they were able to capitalize on these gains by offloading
equity in the company. In other words, they were able to make a profit out of these allocations
without undertaking any mining. That they would make a second round of "windfall
gains" by exploiting the price differential between the coal they mined and the market price
of the mineral as and when they started extracting it, goes without saying. It hardly takes a
rocket scientist to conjecture that of portion of the "windfall gains" would have gone to lubricate
the coffers of the Congress Party.