Citizens' Issues
Coal shortage and the failure of Railways in providing rakes

While our power plants are slowly cutting down production, imported coal lies at these ports simply because Railways are unable to deliver the rakes. It is time a serious investigation is made as to why Railways are unable to supply the required number of rakes on a daily basis?


According to the Central Electricity Authority (CEA), 60 out of 103 power plants have less than a weeks' supply of coal and unless Coal India expeditiously moves coal from its stocks, lying in pitheads and elsewhere, to these points, we are most likely to face power outages in the week ahead. In fact, India's largest thermal power producer, NTPC, has already shut one of its five units, due to coal shortage, and the situation is precarious, to say the least.


The severe cyclone Hudhud has left in its wake a trail of destruction and damage, and a few deaths in both Andhra Pradesh and Odisha. Fortunately, the impact of this cyclone Hudhud has been reduced, thanks to the advance preparation by the government, which put all its facilities to evacuate the public from the anticipated path of this severe cyclone.


Flooding has taken place in the affected area; lot of agricultural damage to standing crop, destruction of property, damage to power lines etc have been reported. What we still do not know is whether the flooding would be affecting the coal mine areas in Odisha.


In the recent months, Krishnapatnam Port has been in the news, because it has been specially geared up to receive a huge surge in coal imports, and this port has been anticipating a 50% growth this year. To what extent this Hudhud is going to affect their plans remains to be seen, once full details of the cyclone impact are assessed. The Paradip port has also been getting additional equipment to deal with increase in the coal imports but, here again, Hudhud impact is not known, yet.


What is however shocking is that Paradip has about 2-3 million tonnes of coal at the port and press reports indicate that they have as many as 400 pending indents lying with the Railways. In reality, they are able to get 9 or 10 rakes a day as against the demand of 20 to 25 rakes. This means that while our power plants are slowly cutting down production, imported coal lies at these ports simply because Railways are unable to deliver the rakes.


It is time a serious investigation is made as to why Railways are unable to supply the required number of rakes on a daily basis? Minister Sadananda needs to investigate this lapse and take the inefficient officials to task.


Press reports indicate that there have been some top level appointments in the subsidiaries of Coal India Ltd. A close study would reveal that, in fact, no new qualified personnel have taken over the realms of these coal fields. Simply, inter-company changes have taken place and that too, after the vacancies arose, and which were left unfilled for months, not really, years, before these were effected.


In 2010, according to the media, the Chairman and Managing Director of South Eastern Coalfields (SECL) was arrested by Central Bureau of Investigation (CBI), for accepting graft, and MP Dixit was removed. Until now, for more than four years, this Coalfield did NOT have any Chairman, and work carried on. About a year ago, it would seem that Om Prakash, Director of Technical Operation in Western Coalfields was selected to take over this position as CMD of Southern Eastern Coalfields (SECL), and only NOW he has been given this responsibility!


It would be worthwhile studying as to why Om Prakash has not been upgraded in Western Coalfields itself, which, in all fairness, he would have better knowledge and grip of the situation? However, when MP Dixit was arrested, it was N Kumar, Director Technical at the Coal India was deputed as CMD. Here again, all the knowledge that N Kumar gained in handling the affairs of SECL would be lost, he would be reverting back to the parent organization! What has prevented the Government in confirming this position in favour of N Kumar? This would be another interesting study.


In the case of Northern Coalfields, it appears that the CMD of this unit was accused of malpractice, though full details have not been made public. TK Nag, Director Technical of Ranchi based Central Coalfields has now been named as the new CMD of Northern Coalfields! Here again, with his knowledge and experience in Central Coalfields, would he not be suitable candidate to succeed the current CMD, if his term is over?


In the case of RR Mishra, Director of Personnel in the Central Coalfields Ltd would now become CMD of Western Coalfields, whose chairman, D C Garg passed away recently (in June this year), who appears to be a non-technical person.


It may be recalled that when all these were happening, Coal India's former CMD S Narasing Rao was talking about acquiring oversea assets and simply decided and quit to rejoin the administrative service in Telengana. At least, in the future, the concerned ministry should ensure that no one should be allowed to leave their top positions until the major pending issues are settled to the satisfaction of the Government.


Finally, the Public Enterprise Selection Board (PESB) has issued advertisements to attract CEOs, CMDs, President or Directors of private sector companies with a turnover of over Rs5,000 crore for presumably top management positions in Government companies. According to the press, the total remuneration package offered is about Rs75 lakh per annum which is low and not attractive enough to qualified candidates to even apply. Private enterprise offers great facilities, including bonus, profit sharing and shares so that the very best is tempted to offer their services.


Coal India should be denationalised; these independent coalfield companies, all seven of them, must be made free to operate with the top management have a stake in each company. There ought to be incentives to perform and deliver the goods. Let the government permit this to happen in the case of Coal India, as an experiment, and one can see the miracle of high production in less than one year's time.


Government must be bold and innovative to make this move. Otherwise, we will continue to be facing such crisis one after another.


(AK Ramdas has worked with the Engineering Export Promotion Council of the ministry of commerce. He was also associated with various committees of the Council. His international career took him to places like Beirut, Kuwait and Dubai at a time when these were small trading outposts; and later to the US.)



jaideep shirali

3 years ago

The question of why the Railways do not have enough rakes is evident when we consider two simple facts. Firstly, Railway Ministers are more interested in scoring points with unprofitable passenger routes, rather than freight, which gets the revenue but not votes. Secondly, the operating ratio remains above 90% consistently, which indicates the Railways are hardly interested in activities that garner income, but more on spending it. The Railways are critical for cheap and quick transportation, but this is one battle they seem to be very keen to lose to competition. The Railways seem to run for their own staff, not for the country. Till we have a change in attitude at the top, we cannot expect any change in the Railways.

Dr Anantha K Ramdas

3 years ago

After submitting this article, out of curiosity and in public interest, I looked up the web site of Coal India Ltd.

I would appreciate readers of this article to look up the same.

They would be unhappy to note that the Management of Coal India have not yet bothered to make the corrections for the recent changes made.

The nonchalant attitude would be revealed when it will be found that the name of Late D C Garg, who passed away in June this ear still appears on the web site.

Does anybody really care? If they can't update their own web site, would somebody take the trouble to chase the Railways as why the Rakes have not been supplied to various points where they are required?

Frankly we do not know on whose account the million tonnes of coal are lying in the ports - but the core issue is what prevents Railways to make the rakes available, particularly when the requisitions have been made in advance?

Those responsible for this kind of mess needs to be punished.

Value stocks based on different methodologies


Price to Book Value (Banks)


Stocks trading far below their book value is a...

Premium Content
Monthly Digital Access


Already A Subscriber?
Yearly Digital+Print Access


Moneylife Magazine Subscriber or MSSN member?

Yearly Subscriber Login

Enter the mail id that you want to use & click on Go. We will send you a link to your email for verficiation
Wonga's (Hidden) Interest Rate from Hell

UK regulator bans payday loan company's ad for failing to disclose monstrous interest rate


Some secrets hurt more than others. Like, say, an interest rate over 5,000 percent.

Last week, the U.K.’s Advertising Standards Authority (ASA) banned payday loan firm Wonga from using a TV ad that the regulator said failed to disclose a monstrous interest rate. The figure missing was 5853 percent — Wonga’s representative APR (RAPR).

The ASA ruled that the TV spot included “an incentive to apply for credit” with the phrase “you can even pay back early and save money” and thus should have revealed the RAPR.

Citizens Advice, an independent consumer group in the U.K., reported the TV ad to the ASA, as well as six other payday loan ads from other lenders. The group said in a statement after the regulator’s ruling on Wonga:

Adverts must be clear about what taking out a loan means and how much it will cost. The consequences are really serious when payday lending goes wrong. High Interest rates and fees can mean that a small loan balloons into a huge debt.

In what may be the understatement of the year on a company’s website, Wonga states under its “How it works” tab that its service “isn’t always the cheapest option” and outlines the consequences of not repaying on time:

So maybe think twice before you say, show me the wonga.

Click here for more Terms of Surrender posts. And let us know if you think you’ve spotted a potential candidate for next time.



We are listening!

Solve the equation and enter in the Captcha field.

To continue

Sign Up or Sign In


To continue

Sign Up or Sign In



The Scam
24 Year Of The Scam: The Perennial Bestseller, reads like a Thriller!
Moneylife Magazine
Fiercely independent and pro-consumer information on personal finance
Stockletters in 3 Flavours
Outstanding research that beats mutual funds year after year
MAS: Complete Online Financial Advisory
(Includes Moneylife Magazine and Lion Stockletter)