The Hindu : Business : Coal India's plan to reach non-linked consumers

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Thursday, Dec 14, 2006
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Coal India's plan to reach non-linked consumers

Indrani Dutta

Sequel to court order on e-auction

KOLKATA: In the wake of the apex court order prohibiting the sale of coal through e-auction, the public sector Coal India Ltd (CIL) is now working on an alternative to maintain the supply of coal to non-linked consumers.

"We will abide by the court order, and we are now looking at alternative routes by which we can maintain supplies to the non-linked consumers who have no official channel for buying coal," a CIL board-level source told The Hindu.

Sources said that not only small and medium consumers in the non-core sectors were buying coal through the e-auction route, but also the new system was meeting the needs of the core-sector consumers when they needed coal beyond the linked quantum.

Conceding that prices of coal sold through e-auction had improved realisations for CIL, sources said that this was just incidental as the CIL's main objective was to bring some transparency in the marketing of coal for non-core sector consumers.

Tobacco e-auctions

Our New Delhi correspondent writes:

The Central Government plans to introduce electronic auction (e-auction) of tobacco in order to break the oligopoly of a few buyers and give better rates to farmers.

Buyers limited

"The problem in tobacco auctions is that the number of buyers is limited. Only three buyers corner 65 per cent of the tobacco and one of them commands half of the market. Transparency in prices with the introduction of e-auction would loosen the stranglehold of the few buyers who are not giving the full benefit to farmers," Minister of State for Commerce, Jairam Ramesh, told the Rajya Sabha during Question Hour.

The Minister said e-auction of tea and cardamom had shown results and the Government would introduce this concept for the tobacco crop within a year. He denied that there was `discrimination' against tobacco farmers of Andhra Pradesh (AP). Karnataka tobacco commanded better rates because it was of better quality than Andhra Pradesh tobacco.

On-line tea auction

Our Chennai Bureau adds:

The Union Minister of State for Commerce, Jairam amesh, held discussions in New Delhi on Tuesday with the MPs of the tea growing areas on the proposed e-auction of tea. The Additional Secretary and Director (Plantations) in the Department of Commerce and Chairman, Tea Board, participated, according to an official release.

Job creation

Basudeb Banerjee, Chairman, Tea Board, gave a presentation on the different primary marketing channels for tea and the role of public tea auctions. Referring to the present electronic auction, the Chairman analysed the issues raised by buyers, brokers and producers on its functioning. The MPs welcomed the proposed e-auction system but expressed concern over the loss of employment in the auction centres. Mr. Banerjee clarified that the proposed system would provide far more employment through the creation of warehousing hubs that would now come up in more locations to cater to the proposed system.

Mr. Ramesh assured the MPs that this issue would be flagged for further deliberations. The Minister announced the conduct of the India International Tea Festival in November 2007 in Guwahati and sought the support of the MPs to make it a success.

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