CAG's coal report: 10 big facts on this big controversy

New Delhi:  The government is now under fire on account of a report by its auditor that says it lost 10.7 lakh crores because it undervalued coal deposits and did not auction coal fields between 2004 and 2009. Here is your 10-point cheat sheet to this story:
1) The losses are part of a draft report by the government's auditor, the Comptroller and Auditor General, which was leaked to the media.

2) The draft report says 155 coal-fields were allocated to about 100 private and some state-run firms or public sector units in a manner that gave "undue benefits" to the companies. The report said the sale of the blocks was "subjective" and allowed "windfall gains", but does not make allegations of corruption or bribe-taking.

3) This afternoon, the CAG wrote to the Prime Minister's Office and said it was embarrassed by the leak. "The observations which are under discussion at a very preliminary stage ..and hence are exceedingly misleading," the letter allegedly states.

4) The Opposition attacks in Parliament, says the Prime Minister, who supervised the Coal Ministry for some of the period in question, must explain.

5) Coal Minister Sriprakash Jaiswal says ads were placed to invite offers from interested firms, and that BJP state governments, like in Rajasthan, had opposed a process of bidding.

6) India is the world's third-largest coal producer in the world after China and the United States.

7) Analysts and experts say that  an auction would raise power tariffs and that not all coal blocks are profitable or commercially viable. They say CAG has erred in its calculation of losses.

8) State-run power company NTPC says it made no windfall profits from the allocations and that the lower costs meant cheaper electricity for consumers.

9) The Indian subsidiary of ArcelorMittal, and steel makers Tata and Jindal Steel and Power, are among the companies named in the report. Jindal's controlling shareholder, Naveen Jindal, who is also a member of parliament, defended the policy of direct allocations, saying it had allowed private companies to jump-start production at mines left idle by state-run Coal India Limited, the world's single largest producer.

10) Coal fields are currently allocated by a screening committee.  Interested firms are given points for different parameters- whether land and environmental clearances are in place, for example. Parliament last year approved amendment to Mines and Minerals Regulation and Development Act of 1957 to enable the government  to auction coal blocks

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