By IANS,
Kolkata : The Coal Consumers’ Association of India (CCAI) Tuesday said the recent price hike in coal by Coal India Limited would hit major sectors of the economy, especially cement and steel, and demanded a roll back.
“Coal India Limited increased A and B grades coal prices by 150 to 160 percent and C grade coal prices by 30 percent Feb 27 this year. The price hike is applicable to steel, sponge iron and cement sectors. And it will not be applicable to power utility and fertilizer sectors,” said CCAI president P.K. Chand.
“The basic that has been said by the Coal India Limited is that the price hike is to set the prices of domestic coal to the international standard, which to our mind is not correct. Because there are basic differences between domestic coal and imported coal. Quality of imported coal is very consistent. But in India the coal is not of the international quality,” said Chand, who is chief financial officer of Birla Corporation Limited.
“If the price hike is not rolled back then coal cost of cement industry would be increased by 40 percent. A 4 million tonnes cement plant will have to incur Rs.125 crore more due to the coal price hike. Overall the total cost of cement industry will be increased by 15 to 20 percent and there will be price hike of Rs.9 to Rs.10 per bag,” he added.
“Steel sector is also badly affected due the coal price hike. Total cost of steel sector will be increased by 15 to 20 percent,” said B. Bhushan Agarwal, vice-chairman and managing director of Shyam Group of Industries.
Shashi Kumar, former Chairman of Coal India Limited and CMD of Indian Mining Consultancy (Pvt) Ltd, said: “Certain consumers have been very significantly hurt in the price increase and certain others have been left untouched. This has never been the case in price increase earlier. A clear-cut distinction has been made this time. Such absolute power of Coal India Limited should be used with certain amount of restraint. This is lack of thinking behind what has been done.”
“We have already written to the Coal Ministry to roll back the price hike. We will make representation to the prime minister. A special committee is needed to deal with the case,” Chand said.