S.Q. Zama, secretary general at the incumbent Congress Party which is backed by India’s National Mineworkers Federation, said miners will “vehemently oppose” the move; a single day of stoppage at Coal India could lead to a loss of 1.2 million metric tons, in turn putting pressure on power plants, cement and steel factories nationwide. Like China, India is home to some 500,000 coal-fired power plants.
Coal India, having missed its targets for Q1, however, is beset by labor unrest and delays in mining approval acquisition to boost production in lieu of imports. According to government statistics, an electricity shortfall of less than 10% can curtail 1.2% off the $1.8 trillion economy; India is expected to outpace China as the world’s most populous nation in five years.
New Delhi, which owns 90% of the mine, is considering selling a 5% interest to the public and a similar amount to Coal India itself, according to a report cited by Bloomberg News. “Workers fear a stake sale will lead to privatization and exploitation,” R. Mohan Das, Coal India’s personnel director, told Bloomberg.
Prime Minister Manmohan Singh’s administration has already divested stakes in other significant Indian extractive companies to close the biggest budget gap among major emerging economies. In 2010, five main worker unions successfully opposed a similar 10% Coal India sale while wage increases were part of negotiations the following year.
