The Allocation of 142 Coal Blocks- Arun Jaitley

THE ALLOCATION OF 142 COAL BLOCKS

- ARUN JAITLEY
Leader of Opposition (Rajya Sabha)

The arbitrary and discretionary allocation of 142 coal blocks is the latest albatross round the neck of the UPA Government. The arrogant and despotic government did not realize when the allocations were made that it would be held accountable for each of these coal block allocations.

The Comptroller and Auditor General has based its’ report on the allocation of these coal blocks primarily on the ground that after a decision was taken to switch over to the competitive bidding system it took the government eight years to implement the said decision. During this eight year period 142 coal blocks were allocated to private entrepreneurs most of whom were traders and not actual users. Since the Screening Committee mechanism did not realize the actual value of the coal blocks a monumental loss has been suffered by the Public Exchequer.

The eight year delay is on account of an objection raised by the Prime Minister’s office, an incorrect opinion given by the Law Ministry, inordinate delay in drafting an amendment to the law and an inexplicable delay in implementing the amended law. Each of the reasons for delay does not appear to be bonafide.

For almost five out of the eight years the Prime minister was the Coal Minister. He was assisted by a Minister of State. The corridors of power in Delhi are full of information being provided by the then bureaucrats, the successful applicants and more particularly the unsuccessful applicants. These informations reflect a sad commentary on the functioning of the UPA Government. These information reveal

• A case of inefficiency, lack of leadership, delay in the exercise of power for colorable purpose.
• Over eight years were wasted in not implementing the competitive bidding policy so that 142 successful entrepreneurs could be arbitrarily selected.
• The Screening Committee mechanism was a farce. Individual writ of few people who were running the Government influenced the decision.
• Some of the Ministers of State did not come out with any credit. Their role in these allotments appears to be dubious.
• Successful applicants were asked to associate one or more co-allottees by the Ministry. These were inevitably the political nominees.
• Disturbing information has surfaced that a valuable public resource was being allocated arbitrarily with the underlying condition of political funding of the party in power.
• The officials in the PMO who dealt with the Coal ministry files were not unaware of what was going on.
• Many allottees were traders and not actual users.
• Several allotments have been made without the recommendation of the State Governments.

The whole process of allocation of coal blocks stinks. This raises a larger question of how the Indian State should allocate natural resources. A rudderless government suffering from policy paralysis has sought advisory opinion of the Supreme Court on this larger question. Allocation of natural resources is an issue squarely within the policy domain. Formulation of policy is an Executive function; it is not a judicial function. The Court can merely strike down a policy if it is arbitrary or unconstitutional. The court cannot frame a policy. Which tangible natural resources should be auctioned and which could be allotted on some alternative fair criteria is an issue to be decided by the Government. The courts are an institution empowered to judicially review a decision of the Government. If government formulates a policy which opens the flood gates for corruption, the courts can strike down the policy. What would happen if the courts were to advice the formulation of such an arbitrary policy?

Indian politics is passing through a crisis. The power of politics is immense but the stature of some of the men administering polity is relatively small. It bears no nexus to the extent of power that the polity exercises. As a part of the process of political and governance reforms discretions have to be minimized and eliminated. Every decision of the government has to be based on reason and rationality. Mineral is a valuable natural resource. It occupies an important space in the expansion and development of the Indian economy. Its’ allocation both in the Centre and the States through a discretionary process has led to serious charges of corruption. Recent experiences are persuasive enough for the government to legitimize the policy where such allotment of mineral as a tangible resource is made only through a transparent and open bidding system. There is no substitute for such a policy today.

It has been suggested that since the Prime Minister himself was the Coal Minister we should assume that this decision was fair. The Prime Minister’s office is a sacred institution in Indian democracy. It has to be judged by standards much harsher than those which would apply to Ministers like Shri A. Raja. If the process of allocation by the Prime Minister as a Coal Minister smacks of arbitrariness it shakes our national conscience. The onus is now on the Prime Minister to accept the responsibility for what has happened.

Suggestions that the issue should be debated only in the Parliament will put a lid on one of the greatest scandals in Indian history. We, in the Opposition, are not interested in merely the issue being talked out through a one-day debate in Parliament.

A debate is an essential ingredient of Parliament but so is accountability. If a debate is being used today to put a lid on accountability then an alternative strategy is necessary. Parliamentary obstructionism should ordinarily be avoided. However, in the rarest of rare cases, obstructionism also bring its dividends. The country lost a valuable session of parliament in December 2010 on the issue of 2G spectrum scam. However, the obstructionism led to Shri A. Raja’s resignation, charge-sheets for criminal prosecutions, a Joint Parliamentary Committee, the auctioning of the 3G spectrum and now the surplus 2G spectrum which will bring an enormous amount of revenue back to the Government.

The experience of the 2G spectrum reveals that the government used the reference of the CAG report to the Public Accounts Committee for a cover up. The Government itself has now fixed Rs.14000 crores as a base price for the 2G spectrum auction as against the price of Rs.1658 crores at which the spectrum was allotted in 2008. The PAC is not being allowed to come to the same conclusion by obstructing Members who are helping the ruling alliance. When parliamentary institutions are subverted and accountability is not permitted, the polity must invent new tactics so that the principle of accountability is not sacrificed. Debate and accountability must co-exist.