Newspaper article International Herald Tribune

India Faulted over Sales of Coal Rights to Private Firms ; Audit Says Government Missed out on $34 Billion by Not Using Auctions

Newspaper article International Herald Tribune

India Faulted over Sales of Coal Rights to Private Firms ; Audit Says Government Missed out on $34 Billion by Not Using Auctions

Article excerpt

Both government and corporate officials dispute the agency's fiundings, the latest in a series of scathing indictments of how India has handled natural resources and economic policy.

Indian policy makers cost the government nearly $34 billion in royalties by selling coal concessions to private companies at negotiated prices rather than auctioning them, according to an audit by a government agency released Friday.

The report, the findings of which government and corporate officials dispute, is the latest in a series of scathing indictments of how India has handled its natural resources and economic policy. Coming just two years after a similar review of telecommunications licensing, the audit is likely to put further pressure on the government of Prime Minister Manmohan Singh, which has struggled to defend itself against allegations of corruption, mismanagement and fecklessness.

Two years ago, the Comptroller and Auditor General, the agency which also issued the coal report, estimated that the government had missed out on nearly $40 billion by not auctioning valuable telecom spectrum. The findings of that report and investigations directed by Indian courts have led to the arrest of senior government officials and corporate executives who are now awaiting trial.

In its latest report, the auditor said officials had awarded 142 coal concessions since 2004 on favorable terms to private and state- owned companies, without any bidding for the concessions. That had cost India 1.85 trillion rupees, or $33.7 billion, the report estimated. The coal was meant to be used by companies like Reliance Power, Tata Power and Adani Power to fuel new power plants to meet India's fast-growing need for electricity.

"The allocation lacked transparency and objectivity," the report said.

The government's critics seized on the coal report, along with another report released Friday about irregularities in the privatization of the New Delhi airport, as further proof that the government led by Mr. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.