It’s not easy to defend India’s democratic structure and economic policy-making these days. The latest gridlock in parliament over the national auditor’s estimation of a potential loss of $33bn in revenue associated with coal blocks allocation is only the latest indictment of the country’s leadership.
Soon after coming to power in 2004, the Congress-led government realised that Coal India, the government-owned corporation that manages more than 80 per cent of the coal reserves, would not be able to meet the demand from the power industry or the targets set by the 10th five year economic plan. But instead of reforming Coal India, the government decided to re-open the sector to private players, a process already underway since 1993 and that was only to be derailed again by last week’s allegations.
But what makes the current ruckus in parliament both sad and amusing is that the privately-held coal blocks were only ever expected to account for less than 10 per cent of total production in the country.