Adani in race to bag coal imports tender

Hyderabad: The expose of the Narendra Modi government’s ‘power-play’ in the Sri Lanka-Adani green energy plant deal doesn’t seem to have had any impact on the Centre as is evident from its continued efforts to favour certain corporate giants. The latest exercise in this direction has been in the contentious coal imports, with the BJP […]

Hyderabad: The expose of the Narendra Modi government’s ‘power-play’ in the Sri Lanka-Adani green energy plant deal doesn’t seem to have had any impact on the Centre as is evident from its continued efforts to favour certain corporate giants. The latest exercise in this direction has been in the contentious coal imports, with the BJP government pushing for government-to-government deals with coal exporting countries like Russia, Australia, Indonesia and South Africa under the guise of getting imported coal at discounted rates.

The Central government-owned Coal India Limited (CIL), a Maharatna company, has already issued tenders for importing 6 million tonnes (MT) of coal, and at least half of the coal will be imported through private corporate companies. And yes, no prizes for guessing, Adani Enterprises is prominent in the list of corporates that will bring in coal into the country!

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As is well known by now, the union government, citing coal shortage, has been pressurising State-run power generation companies to increase coal imports for blending with local coal to the extent of at least 10 per cent of their requirements. The BJP government has even warned the Gencos of cutting down supply of domestic coal unless the power plants build up coal inventories through imports. But majority of the States refused to comply pointing out that imported coal was five times costlier than domestic coal.

The CIL, however, was directed to import coal and supply the stocks to power generation companies to address the coal shortage and also to build buffer stocks. The Centre also justified its action stating that heavy rains and flooding during the monsoon season would slowdown domestic coal production between June and September.

According to sources, the Centre was yet to get into direct government-to-government negotiations with Russia, Australia, Indonesia or South Africa to help CIL import coal at discounted rates, but the coal major, apparently proxying for the Centre, recently held a pre-bidding meeting with around 11 prospective coal importing agencies including Adani Enterprises, Mohit Minerals and Chettinada Logistics, among others. The CIL said the companies had shown keen interest in the bidding process and as per their request, it was decided to narrow the time window of the bid price validity from 90 days to 60 days.

In its regulatory filing on Tuesday, the coal major announced that 11 coal importers joined the session with the company officials. Among other amendments proposed by the ‘interested’ bidders including Adani Enterprises, was fixing the time period for supply of the first tranche of coal shipment, from the date of the letter of award, to between 4 and 6 weeks. Earlier, the supply schedule was based on a particular percentage of delivery in each month of the second quarter of the financial year 2022-23. The CIL found the amendments ‘favourable’ and amended the bid document and floated a corrigendum on the e-procurement portal to hasten the process without any hiccups.

With the CIL floating tenders, the union Power Ministry directed the States to suspend tenders that were ‘under process’. Further, the Ministry, which had asked State-run power generation companies to meet 10 per cent of its requirements by blending imported coal with domestic coal, invoked Section 11 of the Electricity Act to make it mandatory for all imported coal-fuelled plants to generate power at their full capacity.