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    CIL’s capital spend on equipment and project less than annual target

    Synopsis

    Law and order issues have delayed land acquisition, which may delay projects and pose obstacles for the company in achieving its target of producing 1billion tonnes of coal by 2024. It is expected to produce 610 million tonnes this year. The target for 2020-21is 750 million tonnes.

    coal-india-agenciesAgencies
    Kolkata: Coal India’s capital spending on projects and equipment in 11months this fiscal has been only 44% of the annual target. Company executives attribute the low level to land acquisition issues.

    The state-run company had spent Rs 4,360 crore as of end of February, and is expected to fall short of target, according to a senior executive of Coal India. The expenditure was meant for land acquisition, heavy mining equipment, wagons and infrastructure at mines.

    Law and order issues have delayed land acquisition, which may delay projects and pose obstacles for the company in achieving its target of producing 1billion tonnes of coal by 2024. It is expected to produce 610 million tonnes this year. The target for 2020-21is 750 million tonnes.

    The Centre has reduced its investment target for the year from Rs 10,000 crore to Rs 8,000 crore. For 2020-21, the target has been fixed at Rs 9,500 crore.

    Law and order problems in several states are affecting land acquisition for expanding existing mines and taking up new mining projects. Land acquisition involves payment of compensation to land losers and Coal India keeps aside funds for the purpose. It is spent as and when land is successfully acquired.

    The company has set aside almost Rs 7,000 crore for expenditure on machinery over three four years.

    Coal India has already placed bulk orders for equipment and they are yet to be delivered. Executives expect most of the deliveries to start towards the beginning of the next fiscal, spilling the investment into 2020-21. Investment on wagons is expected to be about Rs 700 crore.

    To produce 1billion tones of coal, Coal India plans to spend almost Rs 56,000 crore on 66 coal projects, which would be able to produce 500 million tonnes a year.

    About 55% of the capital outlay would be undertaken by South Eastern Coalfields, which is working on 23 projects with a peak capacity of 192 million tonnes.

    Mahanadi Coalfields is working on 11 projects with peak capacity of around 156 million tonnes. Western Coalfields is working on 15 projects with peak capacity of about 35 million tonnes.

    Eastern Coalfields, Bharat Coking Coal, Central Coalfields and Northern Coalfields will, among them, develop 30 projects with production capacity of 110 million tonnes.


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