Coal news and updates

Cement body wants tapering quantities restored

January 19: The Cements Manufacturers Association (CMA), in a recent communique to the Special Meeting of the Standing Linkage Committee (Long Term) for Power, Sponge & Cement Sectors, has sought immediate restoration to normalcy of those linkages affected by the government’s Tapering Linkage Policy of 2010.

In the communique made available to ICMW, the CMA has said around 5.36 million tons (mt) of coal supplies to the sector have been affected by this policy, which translates into around 32 mtpa of cement capacity, affecting an investment of Rs 18,000 crore.

“With the SC declaring allocation of coal blocks illegal and arbitrary, the tapering linkage policy, keeping allocation of coal blocks as a basis, should be scrapped ab-initio,” the CMA has said.

The tapered quantities must also be returned to the cement manufacturers as the sector is entitled to 75% of its total requirement under the National Coal Distribution Policy (NCDP), said CMA.

The CMA also said that around 175 coal linkage applications are pending with the Ministry of Coal “un-processed”.

Operating cement plants whose applications are pending must be granted coal linkages at regulated prices, the body has urged.

The CMA also feels the thrust on the power sector has resulted in a neglect of other sectors in terms of coal linkages. “There have been no coal linkages for the cement sector since 2007,” it said.  Consequently, it said, for coal linkages granted to every 1,000 MW in the power sector, these should be for 1 mtpa cement plant in view of the importance of cement in a nation’s economic development.

The Indian cement industry is the 2nd largest producer in the world, next only to China.

The installed capacity is more than 360 mtpa but in 2013-14, production was limited to only about 255 mtpa. Around 100 mtpa of capacity is lying idle, leaving an investment of Rs 60,000 crore stranded, mainly on account of non-availability of assured fuel, the CMA stressed.

The sector has a vision to achieve production of 550 – 600 mtpa by 2022.