Revival of Singareni

From being declared as a sick unit twice, SCCL has scripted a remarkable turnaround — thanks to a change in the mindset of management and workers, and backed by the State government.

By Author  |  Published: 16th Dec 2017  12:00 amUpdated: 16th Dec 2017  12:23 am

No other example can perhaps drive home the point that Statehood for Telangana was critical for the region’s development and prosperity than the success story of Singareni Collieries Company Limited (SCCL). That the resurgence of SCCL was scripted in just a matter of three years makes it all the more significant.   

There was a time when strikes plagued the coal mines between 1992-94 and 1996, prompting the then government of undivided Andhra Pradesh to declare it as a sick unit twice. Attempts were even made to sell it or at least shut it down to avoid losses. Two decades later, and after formation of Telangana State in 2014, the same sick unit is now a much sought-after company by the AP government which is seeking share in the company assets. In sharp contrast to general trend across the country, SCCL witnessed about 15 per cent increase in profits last year amounting to about Rs 1,000 crore and is planning to open at least 31 new coal mines over the next five years including 12 underground mines. This then is the growth quotient and success story of Singereni Collieries, once written off, and its employees.

It is not an easy task to turn around a company with a huge work force of 58,000 people who work under extremely difficult and hazardous conditions, and is spread over six districts with a turnover of Rs 16,000 crore. Thanks to major shift in the thinking process of management and workers as well as an extremely supportive State government, SCCL succeeded in making a turnaround in terms of both revenue and production.

N Sridhar, SCCL Chairman and Managing Director

“Only a management with a clear thinking process and in-depth knowledge, complemented with a devoted workforce and backed by a government with a proper vision, can lead this institution to greater heights. We have not only regained trust of our employees and workers, but have also reintroduced discipline asking them to not take the ‘good will’ for granted. We have also implemented cost-cutting with regard to unnecessary expenditures besides improving productivity and reducing production cost through deployment of latest technology and machinery,” says SCCL Chairman and Managing Director N Sridhar.

Analysing the productivity and distribution in the last five years, one can understand the importance of a planned strategy, and usage of manpower in an encouraging environment, to improve the rate of development. The two per cent growth rate in 2011-12 and 2012-13, was followed by reverse rate of (-) 5 per cent in 2013-14.

The formation of Telangana State on June 2, 2014, laid the foundation for not only resurrection of the company but also its re-emergence as a leading coal production company. In the first year after Telangana State was formed, a growth rate of four per cent was registered in 2014-15. But the company took a giant leap and recorded an incredible growth rate of 15 per cent in 2015-16. Similarly, coal dispatches also witnessed a growth rate of three-four per cent in 2011-12 and 2012-13, even as 2013-14 registered reverse rate  of (-) 10 per cent. However, coal dispatches improved in 2014-15 with 10 per cent growth rate and in 2015-16, this was 11 per cent.

The State-owned mining company surpassed its annual coal production target of 58 million tonnes in 2016-17 by achieving output of 61.4 million tonnes. A turnover of Rs 18,389 crore was registered for 2016-17, up by 11.3 per cent over previous year’s turnover of Rs 16,516 crore.

SCCL Growth Graph

At present, the company is operating 30 underground mines and 17 open cast mines with around 66 per cent of its coal supplied to power plants spread across Telangana, Karnataka, Tamil Nadu, Maharashtra, Andhra Pradesh and Kerala, while the remaining coal output is supplied to cement, captive power, sponge iron and other sectors.

Explaining the reasons for SCCL’s downfall in undivided AP, Chief Minister K Chandrashekhar Rao recently said that the Andhra rulers never understood Singareni or its able workforce.


CM KCR on SCCL success

“The previous Congress and TDP regimes led by Andhra rulers exploited the Sinagreni workers and never understood or solved their problems. Further, the company holds a lot of sentimental value as it provides livelihood for over 50,000 families,” he said. Following the recent victory of Telangana Boggu Gani Karmika Sangham (TBGKS) in the recognised union elections, the Chief Minister reiterated his commitment to restore succession employment which instilled confidence among employees.

Now the State-owned coal company is witnessing huge growth rate, and is on the path of expansion, contrary to general trends across the country where even Coal India Limited is planning to shut down around 65 mines including 37 underground mines. Under its five year action plan, SCCL is planning to open around 31 mines including at least 12 underground mines. In the current fiscal itself, SCCL will be opening 12 mines including six underground mines. “Further, we have set a target of increasing the coal output to 100 million tonnes in 2019-20. Hence, it is crucial for us to open new mines to increase our output and meet rising demand for coal,” an official from SCCL said.

As part of the expansion, the SCCL management is trying to expand its operations beyond Telangana State and had secured Naini coal block in Chhendipada of Odisha two years ago. The coal block is estimated to be spread over 912.78 hectare of government and reserve forest land along with 122.75 hectares of private land in five villages. The company is targeting to open the mine in the next three-four years.

After 127 years of coal production, the Singereni Collieries forayed into power generation and has set up 2X600 MW power plants in Jaipur mandal of Mancherial district.

Started in 2011, work on the power plants gained speed after the Telangana government took over and commenced electricity generation commercially from August 2016. Now, the company is expanding it further by adding another 800 Mw unit. Just like the previous project, BHEL has been entrusted with the execution of the project.

First institution in India to take up coal mining

The first institution in India to take up coal mining in the public sector, the SCCL’s history dates back to 1871, when Geologist Dr William Kings discovered that there Illandu area had coal belts. The company came into being in 1889, starting with a mining capacity of about 60,000 tonnes per year, which has now grown to a stupendous mining capacity of about 600 lakh tonnes a year. Over the decades, the growth graph of Singareni overcame many obstacles and ups and downs. The experience gained by mining for over 12 decades and a stockpile for a further 12 decades to fill up the lives of the people with light is the greatest wealth of Singereni.

During the British rule, (in 1886, the company was registered in the England Stock Exchange as Hyderabad Deccan Company Limited), it started coal extraction in 1889. It was rechristened as Singareni Collieries on December 23, 1920, and registered as a Public Limited Company as a Hyderabad Company. In 1945, it came under the control of the Hyderabad Nawabs, and from 1956, it was under the governance of undivided Andhra Pradesh. In 2014, it came under the governance of the Telangana government.

Singareni History

One cannot narrate the history of SCCL without recalling the strikes led by Singareni Karmika Samakhya (SIKASA) which was allegedly a frontal organisation of the then dreaded People’s War Group (now The Maoist Party) and subsequent losses that drove the company into loads of trouble. Between 1980 and 1996, SIKASA led a large number of strikes at the coal fields, paralysing operations at SCCL. As the SCCL came closer to bankruptcy, SIKASA’s influence waned and was banned since 1992.

Singareni Coal Field Workers’ Union affiliated to All India Trade Union Congress (AITUC), was formed through elections.

Employees and reforms

From using oil lit lamps or ‘Chirags’ and digging with crowbars to using LED lamps and extracting coal with semi-mechanised Side Discharge Loaders(SDL)/Load Haul Dumpers(LHD), to extremely efficient cutting technology for extraction of coal like Long Wall and Continuous Miner, it has been a long journey of continuous development and modernisation. Emphasis is now given on workers welfare. From a stage where there was no value for their lives and they were making enough money to take care of their basic needs and rights, the workers are now being organised and facilities like basic pay, drought allowance, attendance bonus and extensive medical facilities have been introduced. The Telangana government has increased compensation to bereaved families of workers to Rs 25 lakh in case of accidental death and Rs 15 lakh in case of natural death from a meager Rs 5 lakh and Rs 75,000 respectively. In case of death or medically unfit condition of employees, one of the family members will be given a job. While only 200-250 persons were given employment under this category before the State formation, the Telangana government provided relevant jobs to 3,200 people in the last two years. Further, new appointments that were stopped two decades ago have resumed and around 2,300 persons secured jobs.

Now, the State government has decided to revive the dependent employment scheme,
which was dropped two decades ago, and invited applications about a year ago. After overcoming legal hurdles, the government is now planning to commence recruitments under this category.

Singareni coal mining

Social Responsibility

The SCCL management increased the budget for Corporate Social Responsibility (CSR) from Rs 23.75 crore in 2011-12 to Rs 59.79 crore in 2014-15. Besides taking up environmental conservation, the company has planted one crore saplings under Haritha Haram, a flagship programme of the State government. It is also taking up development of villages adjoining the coal mines, through Singereni Seva Samithi. To make the nearby colonies litter-free and more comfortable to live in. A programme called ‘Me Kosam- Me Chanthaku’ was launched in Singareni townships and surrounding areas.