The government on Wednesday welcomed the Supreme Court’s decision cancelling licences of all but four coal blocks allocated since 1993.
Union Law Minister Ravi Shankar Prasad said the verdict was in accord with the Government of India’s stand in its affidavit submitted to the court and would allow the government to make a “fresh start.”
“The government has already taken a position that we will be happy if all [coal blocks] are cancelled so that we can make a fresh start except for those which are [with] government companies and some other [with] pressing needs,” Mr. Prasad told journalists here.
The former Coal Secretary, P.C. Parakh, said the judgment could be looked at in different ways.
“One view is that it has altered all decisions taken by governments in the past decade bringing uncertainty … but from another point of view … it is a direction to the government that decisions should be taken in a transparent manner … to that extent it also gives a signal to investors that future decisions will be taken in a transparent manner,” Mr. Parakh told The Hindu .
He said the impact of the judgment on the economy would depend on the government’s response.
“If the government acts fast and ensures reallocation takes place within six months as the SC has indicated, then I think there shouldn’t be any serious dislocation,” he said.
“Also, in open bidding, current holders should be given right of first refusal … wholesale transfer of blocks to some other companies has potential to delay production … leading to power troubles,” he said.
Regarding fears over investments already made going to waste, Mr. Parakh said change of ownership would not alter things much. “Investments made in downstream projects are safe … even if some other company assumes ownership, coal will still be available … so those apprehensions are not justified,” he said.
CPI leader Gurudas Dasgupta welcomed the judgment but raised concerns over the interests of workers employed at the operational mines and the investments already made.
“It is a laudable judgment … a right judgment ... to correct the wrongs perpetrated by one or the other government … by doling out national wealth and totally undermining national interests,” said Mr. Dasgupta. “But questions remain over the hundreds of thousands of workers employed at operational mines,” he said.