Telangana Government Accused Of Plotting Major Coal Import Scam

Hyderabad: The Telangana government has been accused of creating an artificial coal shortage and preparing to import expensive coal from Indonesia and Australia, despite the availability of domestic coal at significantly lower prices.

According to allegations circulating among officials, a plan is being considered to import around 50 lakh metric tonnes of coal for thermal power generation. The proposed imports could reportedly cost between Rs 10,000 and Rs 15,000 per tonne, while domestic coal is available at around Rs 3,800 per tonne.

Officials associated with Telangana GENCO have reportedly expressed concern that purchasing coal at such high prices could place a heavy financial burden on the power utility and push it further into financial difficulties.

The allegations also claim that an attempt is being made to create a shortage of domestic coal in Telangana and use the situation to justify costly imports. GENCO officials are said to have raised concerns that coal stocks, which should ideally support around 21 days of generation, have reportedly fallen to only about four days.

Officials have reportedly urged the Energy Department to explore supplies from the Naini Coal Block and Coal India and obtain coal at prevailing market prices. However, the Energy Department allegedly wrote only to the Mahanadi Coalfields and sought coal at an older price rather than the prevailing market rate. This reportedly resulted in Coal India not coming forward to supply the required quantity.

Questions have also been raised over the supply of coal from Singareni Collieries Company Limited (SCCL). Critics allege that outstanding payments to Singareni have not been cleared and that the resulting difficulties are being used to project a shortage of quality domestic coal.

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Singareni officials, however, have reportedly maintained that the coal supplied by the company is suitable for thermal power generation.

The allegations further claim that Telangana GENCO could face an additional burden of around Rs 6,000 per tonne if it replaces domestic coal costing about Rs 3,800 with imported coal costing around Rs 10,000. Concerns have also been raised over the transportation of imported coal and the possibility of awarding transportation contracts to private parties.

Officials have reportedly recalled that the previous BRS government rejected a proposal to import foreign coal in 2022 because of concerns over its financial implications and operational suitability. They also pointed to differences in the physical characteristics of domestic and imported coal, saying imported coal is generally received in a more powdered form, while domestic coal can contain larger pieces.

Meanwhile, allegations have surfaced that a coal contractor is acting as an intermediary in pushing the proposal for imported coal and is allegedly attempting to influence the Energy Department. These claims have not been independently established.

The controversy has therefore raised questions over coal procurement, GENCO’s coal stocks, payments to Singareni and the proposed import of coal from overseas. A clear assessment of the allegations would require official records on coal availability, procurement prices, tender procedures, GENCO requirements and the government’s proposed import plan.