New Delhi: On August 17, 2022, the Union coal ministry declared the Adani Group as the successful bidder for a 250 million tonne coal block in Madhya Pradesh’s Singrauli forests. The auction for the Gondbahera Ujheni East coal block was unusual. Adani Group was the lone bidder.
Documents reviewed by The Reporters’ Collective show the Adani group cornered the block even when the auction failed because the government had quietly changed the coal auction rules, making it easier for companies to grab coal blocks even in the absence of competition.
The documents reveal that the government has given itself the discretionary powers to allot coal blocks to lone bidders even when auctions fail to deliver competitive bids.
The rules also contradict the assertive claims of transparency made by the Narendra Modi government, which amid much hype, introduced new laws and regulations to auction coal blocks. Seven years later the promise of ending discretionary allocation and replacing it with fair competition are tossed aside when auctions fail.These rules have also undermined the spirit of the landmark 2014 Supreme Court order that struck down arbitrary and discretionary allocations of coal blocks, an order that annulled 204 such allocations by the previous UPA government that were dubbed by the media as ‘Coalgate scam’.
Records show the Adani group is not the only beneficiary of these discretionary powers the Union government has handed itself. The government has resorted to such discretion in at least 12 cases and allocated coal blocks to private companies after failing to attract competition. The firms that have bagged these blocks include Vedanta-owned firms, JSW Steel, Birla Corporation and other lesser-known companies.
In part one of the investigative series, The Collective revealed how the power industry lobby got the government to open up sensitive forest patches in Madhya Pradesh for coal mining. The lobby eyed two blocks in particular. Adani Group, a member of the lobby, was the lone bidder for one of the two blocks the government opened up after overturning years of advice from the environment ministry against such a move.
Part two of the series reveals how the government gives away coal blocks to private companies through a discretionary government allotment route when only a single bidder turns up for the auctions. The fire sale of coal mines comes despite the country not needing additional coal supply now, and having allocated enough coal blocks to take care of the country’s power requirements for the next decade.