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RTIACT,2005

History
HistoryandFormationofCoalIndiaLimited
WithdawnoftheIndianindependenceagreaterneedforcoalproductionwasfeltintheFirstFiveYearPlan.In1951theWorking
Party for the coal Industry was set up which included representatives of coal industry, labour unions and government which
suggested the amalgamation of small and fragmented producing units. Thus the idea for a nationalized unified coal sector was
born.Integratedoverallplanningincoalminingisapostindependencephenomenon.NationalCoalDevelopmentCorporationwas
formedwith11collierieswiththetaskofexploringnewcoalfieldsandexpeditingdevelopmentofnewcoalmines.

Collaboration

FactorswhichleduptoNationalizationofCoalIndustryinIndia

Structure

NationalizationofcoalindustryinIndiaintheearlyseventieswasafalloutoftworelatedevents.Inthefirstinstanceitwastheoil
price shock, which led the country to take up a close scrutiny of its energy options. A Fuel Policy Committee set up for this
purposeidentifiedcoalastheprimarysourceofcommercialenergy.Secondly,themuchneededinvestmentneededforgrowthof
this sector was not forthcoming with coal mining largely in the hands of private sector. The objectives of Nationalization as
conceivedbylateMohanKumaramangalamwereConservationofthescarcecoalresource,particularlycokingcoal,ofthecountry
by
Haltingwasteful,selectiveandslaughtermining.

Achievements
CorporateSongs

Planneddevelopmentofavailablecoalresources.
Improvementinsafetystandards.
Ensuringadequateinvestmentforoptimalutilizationconsistentwithgrowthneeds.
Improvingthequalityoflifeoftheworkforce.
Moreover the coal mining which hitherto was with private miners suffered with their lack of interest in scientific methods,
unhealthyminingpracticesetc.Thelivingconditionsofminersunderprivateownersweresubstandard.
FormationofCoalIndiaLimited
With the Government's national energy policy the near total national control of coal mines in India took place in two stages in
1970s. The Coking Coal Mines (Emergency Provisions) Act 1971 was promulgated by Government on 16 October 1971 under
whichexceptthecaptiveminesofIISCO,TISCO,andDVC,theGovernmentofIndiatookoverthemanagementofall226coking
coal mines and nationalised them on 1 May, 1972. Bharat Coking Coal Limited was thus born. Further by promulgation of Coal
Mines(TakingoverofManagement)Ordinance1973on31January1973theCentralGovernmenttookoverthemanagementofall
711noncokingcoalmines.Inthenextphaseofnationalizationthesemineswerenationalizedwitheffectfrom1May1973anda
publicsectorcompanynamedCoalMinesAuthorityLimited(CMAL)wasformedtomanagethesenoncokingmines.
A formal holding company in the form of Coal India Limited was formed in November 1975 to manage both the
companies.
MajorEventsandMilestones:
201112

MaharatnaStatus
CoalIndiaLimitedwasgrantedthe'Maharatna' status on 11 April, 2011 by the Government of India thus
becomingonlythe5thPSUinthecountry,ofatotalof215CentralPublicSectorEnterprises(CPSEs),to
have been conferred with this status. Government of India has introduced the Maharatna scheme in
February2010forCentralPublicSectorEnterprises,inordertoempowerthemegaCPSEstoexpandtheir
operations and emerge as global giants. So far, the select club has only five members. The objective of
Maharatna is to delegate enhanced powers to the Boards of the identified large Navratna CPSEs, fulfilling
thespecifiedcriteria,tofacilitateexpansionoftheiroperationsbothindomesticaswellasglobalmarkets.
CoalIndiajoinsSENSEX
CoalIndiamadeittothe30stockSensex,on8August2011,globallyconsideredtobethebarometerof
theIndianeconomy,inshortspanofninemonthssinceitslistingon4November2010.Noothercompany
has made it to the index in such a short time. And then Coal India's raise to the top came in just seven
tradingsessionssinceitsentrytoSENSEX.Thisisconsideredtobearemarkableaccomplishment.
MostValuedCompanyinthecountry
On 17 August 2011, Coal India emerged as the Most Valued Company in the country in terms of Market
Capitalization the pinnacle of success every business entity dreams of and aspires for. The company's
value stood at a whopping Rs.2,51,296 Crores. What made the achievement all the more significant was
thatapublicsectorcompanycouldattainsuchloftyheights.

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CMPDIinagasrecoveryproject
CentralMinePlanningandDesignInstitute(CMPDI)theRanchibasedmineconsultancysubsidiaryofCoal
IndiaLimitedhasbeenidentifiedforparticipationinaGreenHouseGasrecoveryfromcoalminesandun
mineablecoalbedsandconversiontoenergy(GHG2E)anEUfundedResearchProjectfromIndiaalong
withIndianInstituteofTechnology,Kharagpur.
The basic objective of the project is to contribute to global greenhouse gas reduction by controlling
methane emission from coal mines and maximizing utilization of produced methane. Moonidih and
SudamdihminesofBCCLhavebeenconsideredfortakingupthisresearchproject.Thetotaltimeschedule
fortheprojectis42months.OfficialsfromCMPDIparticipatedinthekickoffmeetingheldinSlovakiafrom
6th9thOct.'11.AteamcomprisingofProf.SevketDurucanofImperialCollegeofEngineering,London
and Prof. K.Pathak of IIT, Kharagpur and other representatives of both the institutions visited CMPDI on
16th Nov 2011 and the matter was discussed in details regarding the implementation of the project. The
team along with CMPDI officials also visited Moonidih mine and BCCL for detailed discussions. CMPDI has
receivedanadvancepaymentofEURO47,867.35fortheProject.
FinalizesNationalCoalWageAgreementIXinrecordtime
Coal India Limited (CIL) on 31 January 2012, finalized the wage agreement for its 3.63 Lakh strong non
executive work force by giving a 25% increase on gross wages as of 30 June 2011. The wage hike that
would be effective retrospectively from 1 July 2011 is for a fiveyear period. With the conclusion of the
wagenegotiation,CoalIndiaforthesecondtimebecomesthefirstCentralPublicSectorUndertakinginthe
country to successfully finalize the wage pact. The NCWA IX was concluded in a record time of only 6
months since the formation of JBCCI in August 2011. Never in the history of CIL was a wage agreement
concludedsoswiftly.
201011

CoalIndiaLimitedsignedaMemorandumofUnderstanding(MoU)MinistryofCoalon31stMarch,2011
foritskeyperformanceareasforthefiscal201112.AspertheMoUforthefiscal201112,CIL'stargeted
productionandcoalofftakehavebeenfixedat452.00MillionTonnes(MTs)and454.00MTsrespectively
forattainingan'Excellent'rating.Incidentallyforpreviousthreefiscalyearsi.e200708,200809&2009
10CILwasrated'Excellent'.
Under the present MoU for 201112 special emphasis on Research & Development, Corporate Social
Responsibility,Sustainabledevelopment&CorporateGovernancehavebeenmadeasmajorthrustareas.To
attainthetargetedofftake,CILhassought175rakes/dayfor201112asagainsttheaverageavailabilityof
156.8 rakes/day & 161.9 rakes/day during previous and current fiscal years . Average growth of coal
movementthroughRailisonlyaround2%duringthelast3yearswhereasCILhasenvisagedagrowthof
around13.5%throughrailforachievingabovetarget.
Sincelastyear(201011)expenditureonCILR&Dactivitieshastakenaquantumjumpfrom200910level
ofaroundRs15CroresannuallytoRs.30crores.CILhasalsosteppedupitstargetforexpenditureonCSR
activitiesinlinewithDPE'sguideline.
CoalIndiaLimitedbaggedaprestigiousfirsteverinternationalawardinGenevaon7March2011.CILwas
conferredwiththe"CenturyInternationalQualityERAAward(CQE)"intheGoldCategoryinrecognitionof
commitment to Quality, Leadership, Technology and Innovation. It was stated that Coal India represents
success for India in the Business world. The awards were given by Business Initiative Directions (BID) a
leadingprivateorganizationfocusedontheQualityMixPlan.
CoalIndiaLimitedsignedaMemorandumofUnderstandingwithTheShippingCorporationofIndiaLimited
inDecember2010forpromotingaJointVentureCompany(JVC)Inordertocreatecomprehensiveendto
endlogisticsolutionfromloadporttoconsumingend.Currentlyimportedcoalissuppliedbybothprivate
and PSU players at consuming ends, particularly to power stations, with comprehensive quality and
quantityassurance,whereas,incaseofindigenouscoal,CIL'stermofsaleisFreeonRailatColliery
PrimaryobjectiveoftheJVCare
1.Owning/charteringofvessels

2.Draftsurveying

3.Inspectionofcargo

4.Stevedoring at unloading port in India including unloading of vessels, customs clearance, shore
clearance,andstacking

5.Indenting wagons from railways, loading of wagons, quality analysis and delivery of coal at power
stations

4th November was CIL share was listed at Rs.291/ and closed over Rs.342/ on the first day of trading.
Mostimportantly,anationalassetwasofferedtopublicas'peoples'ownership'inPSUs.
21October2010,thedayCIL'sIPOclosed,wouldbeetchedasahistoriceventintheannalsofCoalIndia
Limited. The day unraveled the value and the true potential of CIL. Innumerable road shows involving
count less man hours of effort across the country and in US, Europe markets had resulted in the grand
successofCIL'sIPO.
CIL'sIPOthelargestsofarinIndiancapitalmarketwasoversubscribed15.3times.Theresoundingsuccess
of record shattering result of the company's public offer with the aggregate funds flowing amounted to
Rs.2,35,276.55 crores which was so far unheard of in the Indian capital market. The oversubscription of

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History
theissuehappenedinallthethreemajorsegmentsi.e.QualifiedInstitutionalBuyers(QIB),HighNetworth
Individuals (HNI) and retail. The QIB for which there was a reservation to the extent of 50% of the net
issueoftheshares,theoversubscriptionwasasmuchas24.62times.Around784QIBinvestorshadputin
overUSdollar38billioni.e.Rs.1,71,469.64croreswhichbyitselfisalsoanalltimehighinthehistoryof
IndianIPO.Intheretailsegmentnearly16.36lakhsapplicationswerereceivedthehighestamongallPSU
IPOssofaramountingtoRs.63,639.26Crores.ThisisalsothehighestsofarintheIndiancapitalmarket.
Interestingly, the foreign investors alone had put in around US $ 27 Billion which is equal to first ten
monthsofFIIinvestmentinIndiathisyear.
CRISIL the leading credit rating agency in the country has assigned maximum grading of 5 to CIL's
proposedIPOthebestforanypublicsector.ThegradingindicatesthatthefundamentalsoftheIPOare
strongcomparedotherlistedsecuritiesinthecountry.

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200910

AwardoftheScopeExcellenceAwardtoourCompanybytheStandingConferenceofPublicEnterprisesforthe
year200708.
EstablishmentofCoalIndiaAfricanaLimitada,aforeignsubsidiaryinMozambique
ConversionofourCompanyintoapubliclimitedcompany.
Awardof'MiniRatna'statusbytheDepartmentofPublicEnterprises,GoI,toCMPDIL.
Receipt by our Company of a composite score of 1.47 and rating as "excellent" for the year 20072008 by
DepartmentofPublicEnterprises,MinistryofHeavyIndustries&PublicEnterprises,GoI.

200809

Award of 'Navratna' status to our Company by the Department of Public Enterprises, GoI, for our operational
efficiencyandfinancialstrength,whichaffordsgreateroperationalfreedomandautonomyindecisionmaking.
OverallproductionofcoalbyourCompanyandourSubsidiaries,crossed400milliontonnes.

200708

Awardof'MiniRatna'statusbytheDepartmentofPublicEnterprises,GoI,toCCL.

200607

Award of 'Mini Ratna' status by the Department of Public Enterprises, GoI, to our Company and to MCL, NCL,
SECLandWCL.
Declineindebtasapercentageofnetworthfrom66%in20012002to10%in20062007.

200506

Rating of 'AAA/Stable', indicating highest degree of safety with regard to timely payment of interest and
principal,awardedbyCRISILinrespectoftheRs.250millionbondprogrammeofourCompany.
Introductionofsaleofcoalthrough'eauctionmethod'
ECLandBCCLreportedprofitofRs.3,638millionand2,026.67millioninFiscal2006.

200304

OverallproductionofcoalbyourCompanyandourSubsidiariescrosses300milliontonnes.

200102

Laying down of a minimum internal rate of return of 12% at 85% capacity utilization as cut off for the
developmentofaproject.

199798

CorporatizationofthefinancialflowbetweenourCompanyandSubsidiaries,suchthatourCompanyistoreceive
onlydividendsunderapplicablepolicyfromourSubsidiariesandthecorpusofourCompanywastobeutilized
toprovidestrategicsupporttoalossmakingentityonlyfor,interalia,maintainingtheirproductivecapitalassets.
SanctionofloanofUSD1.03billionfromtheWorldBankandtheJapaneseBankforInternationalCooperation
forimplementing24highlyviableopencaseprojectswithglobalsourcingofequipments,ofwhichUSD484.40
millionwasavailedduringtheperiodbetweenFiscal1998toFiscal2004.

199697

Rating of 'A+', indicating adequate safety with regard to timely payment of interest and principal, awarded by
CRISILinrespectoftheRs.4,000millionbondissuebyourCompany.
Adoptionoffinancialviabilityasthebasisforapprovalofcoaldevelopmentprojects.
DiscontinuationofretentionpricesschemeandtheCoalPriceRegulationAccount(CPRA),withthederegulation
inpricesofcertaingradesofcoal.

199596

Approval of a financial restructuring package by the Government, whereby Rs. 8,917 million of interest liability
was waived, Rs. 9,041.8 million of plan loan repayment arrears was converted to preference equity and Rs.
4,326.4millionofnonplanpaymentarrearswereallowedamoratoriumforrepaymentandinterestaccrualfora
periodofthreeyears,toberepaidinthreeequalinstalments.
AprofitofRs.6,116millioninFiscal1996wasearnedbyourCompany.

199293

FormationofMCLasourSubsidiarytomanageminesTalcherandIBvalleyinthestateofOrissa.

199192

Uptrendofprofitstartedin1991andourCompanyearnedaprofitofRs.1,670millioninFiscal1992.
OverallproductionofcoalbyourCompanyandourSubsidiariescrossed200milliontonnes.
Fixing of coal prices once a year to compensate for increase in price of inputs on a normative cost basis, and
adoptionoftheescalationformulaprescribedbytheBureauofIndustrialCostandPrices("BICP").

198788

'BlastingGalleryMethod'introducedatEastKatrasmineunderBCCLandChoramineunderECL.

198586

FormationofNCLandSECLasSubsidiariesofourCompany,tomanagecertainminesmanagedbyWCLandCCL.

198182

IntroductionofretentionpricesofcoalbyamendingtheCollieryControlOrder,1945bynotificationdatedMarch
31,1982,inrespectofourSubsidiaries.

198081

Construction of five new washeries: Moonidih washery, Ramgarh washery, Mohuda washery, Barora washery,
Kedlawashery.
OverallproductionofcoalbyourCompanyandourSubsidiariescrossed100milliontonnes.

197980

ConstructionofthelowtemperaturecarbonizedplantstartedinDankuniCoalComplex.
The pricing policy of CMPDIL was reviewed to ensure that the company was working on a commercial line
insteadofworkingon"noprofitnoloss"basis.

197576

ChangeofnameofourCompanyto'CoalIndiaLimited'.
IncorporationofCMPDIL,ECLandWCL,andformationofBCCL,CCL,CMPDIL,ECLandWCL,asourSubsidiaries.

197374

Nationalizationofcoalmines,inordertoprovideforahighergrowthincoalsectortomeetthegrowingenergy
needsofthecountry.
IncorporationofourCompanyas'CoalMinesAuthorityLimited'.

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