Coalgate Scam

Even after creating so many scams like 2G scam, Satyam scam, CWG scam, there was yet another scam that caught the attention which is the Coalgate Scam. Over the years the government authorities didn’t take their lesson and instead were able to pull out this mega scam. Thanks to the efforts of CAG (Comptroller and Auditor General) Vinod Rai and his staff that we were able to know about this scam. From 1970’s at the time of Indira Gandhi there have been numerous reforms relating to the allocation of coal mines including allocating coal mines to cement, steel and power producers.

This scam involved almost all private-sector companies of steel and power generation sector and the office of CAG alleges that 57 private-sector companies were allocated coal mines for captive use beginning 2004 making undue gains of 1.86 lakh crore rupees because the government didn’t hand out the mines through a competitive bidding process. Instead, the government followed a policy of allotting coal mines to companies whose applications have been cleared by a screening committee in the coal ministry (Favouring certain organisations). The CAG contends that if there was open bidding, companies would have paid the prevailing market prices for the coal deposits. Based on this, Coalgate looked similar to Telecomgate where A Raja and some of his predecessors allotted telecom spectrum for a fixed price and on a 'first-come-first-served' basis which goes to show how the Government doesn’t learn from its mistakes.

Another cause of worry for us is that it is our Prime Minister who is being brought under the scanner since coal portfolio was under him while the allocation of coal mines was being made and some files went missing from PMO office.Such situations created outrage among the public and the outcome was clear in the 15th Lok Sabha Elections.