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HindustanTimes Wed,01 Oct 2014

Coalgate: Cancellation order may put Rs. 2 lakh-crore projects at stake

HT Correspondent, Hindustan Times  New Delhi, August 26, 2014
First Published: 01:16 IST(26/8/2014) | Last Updated: 10:51 IST(26/8/2014)

India’s top companies in key intermediate industries — power, steel and cement — are keeping their fingers crossed fearing cancellation of coal mines allotted to them years back, some even two decades ago. And the potential investments that may get affected in the three sectors could run into Rs. 2 lakh crore.

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The Supreme Court on Monday ruled that the allotment of 194 coal mines given to companies since 1993 were illegal.

Read: SC says coal block allocations from 1993 to 2010 illegal, done in arbitrary manner

Companies likely to be hit include Vedanta, Essar, Jindal Steel and Power, JSW, NTPC, SAIL, Reliance Power and Hindalco among others.

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Read: CBI to soon close case against Hindalco, KM Birla

For the sector as a whole, project economics and total capacities planned across power, steel and cement will get affected.

“We are not in a position to comment as we are currently evaluating the SC Judgement and the implications for JSPL,” a company spokesperson said.

Read: The curious case of the missing files

Power and coal minister Piyush Goyal welcomed the judgement and said the government will request the apex court to expeditiously resolve issues to help raise domestic availability and reduce dependence on imports.

The government is waiting for the Supreme Court to deliver its final view on how the mines “illegally” allocated between 1993 and 2010 should be treated, Goyal said.

He added that the clarity of law in policy and certainty of future are the “hallmarks of a good economy and will be liked by the investor community”, with the coal sector poised for progress after being in “limbo” for long.

Read: Supreme Court cleans up the mess, but what next?

The minister also said that the economy can now move forward rather than been cast in a shadow of uncertainty and the government is ready to act quickly post the apex court’s final order.

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