x Abu Dhabi, UAESunday 23 July 2017

India's government blackened by no-bid coal scandal

Audit finds the Indian government lost huge sums of money by selling coal fields without competitive bidding.

Labourers load coal onto trucks at a coal depot on the outskirts of Jammu, India. India's national auditor said the Indian government lost huge sums of money by selling coal fields to private companies without competitive bidding.
Labourers load coal onto trucks at a coal depot on the outskirts of Jammu, India. India's national auditor said the Indian government lost huge sums of money by selling coal fields to private companies without competitive bidding.

NEW DELHI // Opposition members of India's parliament shouted and crowded aisles yesterday to demand the prime minister resign after an audit found the government lost huge sums of money by selling coal fields without competitive bidding.

Bharatiya Janata Party members and other opposition leaders targeted Manmohan Singh, the prime minister, because he was running the coal ministry during the 2004 sale. The auditor's report exonerated Mr Singh, but it estimated that private companies got a windfall profit of US$34 billion (Dh124.78bn) because of the low prices they paid for the coal fields.

Pawan Bansal, the parliamentary affairs minister, said Mr Singh would not resign and offered to discuss the auditor's report in parliament. The two houses were adjourned for the day after the opposition blocked proceedings.

Mr Singh's government has been floundering under a crush of scams and corruption accusations over the past year and has been unable to push through crucial economic reforms. The raft of scandals involve corruption claims over the hosting of the 2010 Commonwealth Games and a haphazard sale of cellphone spectrum that auditors said lost the country billions of dollars.

The latest report by the Comptroller and Auditor General said last week the allocations of coal fields were made on the recommendation of state governments.

Gurudas Dasgupta, a Communist Party of India leader, said the ministry was under Mr Singh's charge and he should accept responsibility. "I leave the question of Singh's resignation to his conscience."

The audit revealed that 142 coal fields were sold after July 2004 to private and state-run companies. Some of the coalfields bought by private companies in 2004 did not begin production till 2011, while some companies later made enormous profits by selling the mines.

The report criticised the sales procedure and said the allocation of coal fields "lacked transparency and objectivity".