[Economy] Coal acquisition from Abroad: ICVL and its problemDevendra Vishwakarma
- What is ICVL?
- Why was ICVL formed?
- What’s ICVL’s problem?
- Why no acquisition of coal mines abroad?
- Coal India’s problem
- Mock Questions
What is ICVL?
- International Coal Ventures Limited (ICVL) —
- It is a joint venture company
- formed in 2009 jointly by following entities:
|Steel Authority of India Ltd (SAIL)||Ministry of Steel|
|Rashtriya Ispat Nigam Ltd (RINL)||Ministry of Steel|
|National Mineral Development Corporation (NMDC)||Ministry of Steel|
|National Thermal Power Corporation||Ministry of Power|
|Coal India Limited (CIL)||Ministry of Coal|
- It has a capital base of about Rs 10,000 crore and enjoys the powers of a navaratna company.
Why was ICVL formed?
- To secure metallurgical coal and thermal coal mines abroad, preferably in Australia/ New Zealand, Indonesia, Canada/ USA, South Africa/ Mozambique.
- By the way India has sufficient coal in its own land, but it is either located in Naxal region or cannot be mined due to environmental clearances/ Supereme Court order, hence the need to acquire more coal from abroad.
|Metallurgical coal||to make coke for the iron and steel industry.|
|Thermal coal||electricity generation in thermal power plants.|
What’s ICVL’s problem?
- Ever since its formation, it has failed to acquire any overseas coal assets either through bids or through takeovers.
- This non-performance by ICVL has spurred members to quit the ICVL.
- So on one hand you can’t dig enough coal from India, on the other hand, you are not acquiring enough coal from abroad. What will happen?
- WPI will increase
- IIP will decrease
- GDP will decrease.
- All of above.
Why no acquisition of coal mines abroad?
- Its members have been doing overseas acquisitions on their own.
- Mineral giant NMDC went ahead and secured mines in Australia and
- CIL secured two coal blocks in Mozambique.
- These individual pursuits by the members are diluting the collective efforts made by them under ICVL.
Coal India’s problem
- NTPC has already quit from this ICVL because of its non performance.
- Of the remaining four members, three are under the administrative control of the steel ministry and are consumers of metallurgical coal to be sourced through ICVL.
- Whereas Coal India (CIL) itself is a coal seller.
- So, the business interest of CIL would be seriously compromised if it remains in this ICVL gang.
- Therefore, Coal India is also thinking about quitting ICVL gang.
Q1. Match the following
Q2. Write an Essay on following
“Energy security and Environmental Protection cannot be achieved simultaneously.”