With the deferment of recent coal mine auction on account of insufficient bids, the steel ministry said there was a need to alter the clause stipulating at least three bids for each block and that the coal ministry is consulting CVC to work out a mechanism on the same.
“What happened is as per CVC's (Central Vigilance Commission) norms that you need three bids(for each mine).So now, they (coal ministry) will have to find an answer for that. They will be consulting CVC and work out a mechanism for it,” Steel Secretary Aruna Sharma told PTI.
The government had this month deferred e-auction of the fifth tranche of coking coal mines for steel sector.
“There has to be a fair competition. But steel manufacturers are restricted in the country. So number of bidders for coking coal mines is also going to be restricted. So keeping this in mind, they(coal ministry) will get a guidance from CVC on how to go about it,” the secretary said.
When asked whether steel ministry wants coal ministry to alter the clause, the secretary said: “They will have to. You will not get(bids) at all. It could be one (bid) also of all you know.” She further said, CVC guidelines are very clear adding that when there is a single bid then thereis a reasonability clause.
“For coking coal there are five to six issues which they (coal ministry) will be incorporating in their new tender document,” Sharma said.
A total of six coking coal blocks were to go under the hammer this month in the fifth round, five being in Jharkhand.
“There has to be a mechanism on how you conclude those tenders, otherwise to dispose of coking coal is difficult. Takers are very few. That is what we have seen in the last bid. For one mine, there were three, for others there were one, one and one,” She said.
“Coal ministry will have to work out accordingly so that we have transparent auction, government gets reasonable rates, nobody exploits the governmentand CVC norms are equally followed, she said.
In December 2015, the government annulled the fourth round of coal mine auctions planned for January 2016 on account of poor response from bidders in steel sector as well as depressed commodity prices and adverse market conditions.