Shillong: Coal mining is set to resume in Meghalaya after nine years, Chief Minister Conrad K Sangma said on Wednesday.
He said the Union Ministry of Coal has provided approval for mining lease to four license applicants that would lead to the commencement of scientific mining ensuring minimal environmental impact through sustainable and legally compliant extraction procedures.
“In a significant step towards initiating scientific coal mining, the Ministry of Coal had last month provided approval for mining lease to four applicants out of the 17 prospecting license applicants,” Sangma told PTI.
He said the mining will follow scientific procedures ensuring minimal environmental impact through sustainable and legally compliant extraction procedures.
According to the chief minister, as part of scientific mining, reclamation of coal mining areas and use of advanced technologies such as remote sensing, aerial surveys and 3D modelling would be prioritised and environmental impact would be mitigated significantly.
The National Green Tribunal had in April 2014 imposed a blanket ban on coal mining and transportation of coal in Meghalaya causing a massive blow to the revenue of the state.
As a result, the mining industry suffered a negative growth of (-) 59.36 per cent and the GSDP registered a negative growth of (-) 2.82 per cent, according to the chief minister.
In July 2019, the Meghalaya Democratic Alliance challenged the NGT order following which the Supreme Court upheld the rights of tribal people over the natural resources in their land including coal but upheld the ban on unscientific mining and transportation.
Despite the NGT ban, illegal mining and transportation continued in the state and several cases were filed in various courts including the High Court.
The chief minister in this year’s budget session of the Assembly told the House that around 1,900 criminal cases have been registered for illegal mining and transportation of coal – 1,701 cases for transportation illegally and 203 against illegal mining.
Meanwhile, the Meghalaya High Court has ordered that no coal should be exported to Bangladesh without ascertaining the origin of the coal.
“No coal should be allowed to be exported from any place in the State of Meghalaya to Bangladesh without both the state authorities and the relevant LCS authorities being satisfied as to the origin of the mineral and retaining copies of the documents that may be produced by the intending exporter as to the origin of such material,” a division bench headed by Chief Justice Sanjib Banerjee said in an order passed on Tuesday.
The bench while hearing a case has also directed Assam and the Gasuapara Land Custom Station (LCS) authorities to respond to the queries with regard to the huge quantity of coal exported by a company.
Assam authorities have to indicate whether it was possible for the company to purchase that huge quantity of coal from the open markets in Beltola area and whether it was the truth, the court said.
New Delhi: India’s domestic coal production touched a record 73.02 million tonnes in April 2023, with a growth of 8.67 per cent against 67.20 million tonnes output, recorded during the corresponding period of last year.
Coal India Ltd (CIL) reported production of 57.57 million tonnes in April 2023 as against 53.47 million tonnes of the year-ago period, thus showing a rise of 7.67 per cent.
The government has paved the way for releasing additional coal in the market through greater utilisation of mining capacities of captive and private blocks, which has led to increase in dry fuel production by 17.52 per cent to 9.88 million tonnes in April 2023, as compared to 8.41 million tonnes recorded during the corresponding period of last year.
The total coal despatch has also registered a growth of 11.76 per cent from 71.99 million tonnes in April 2022 to 80.45 million tonnes in April 2023.
His entrance catapults the race into one of the highest-profile political battles of 2024, with the possibility of showcasing both men’s personal ties to an energy industry that President Joe Biden and other world leaders have promised to largely replace with renewable power.
Manchin, perhaps the most vulnerable Senate Democrat, confounded members of his party by stalling major legislation aimed at reducing fossil fuel use. But by ultimately voting for the Inflation Reduction Act, which pours hundreds of billions of dollars into clean energy, he risks losing support among voters with ties to coal.
Both men have earned millions from their families’ fossil fuel businesses.
Over the years, Justice’s family coal businesses have collected millions of dollars in state and federal fines for pollution and public safety violations. The businesses have a long history of ignoring those fines or paying them after years of protracted legal efforts.
Manchin’s political position has benefited his business interests, which include a family company that trucks discarded coal to a high-emitting power plant near his hometown. The facility is the only plant in West Virginia that still uses waste coal to generate electricity.
Accusations around conflicts of interest have followed Justice, 72, and Manchin, 75, through much of their careers. But that has not slowed their political rise in West Virginia, said Rob Cornelius, the former chair of the Wood County Republican Executive Committee and a critic of Justice, whom he described as “Teflon as hell.”
“We expect our leaders to be a little dirty, I guess is the nice way of putting it,” Cornelius said. “No one here cares about what I would call government and business corruption, and that’s probably an indictment of our voters.”
A spokesperson for Justice did not respond to requests for comment.
Manchin has said he will not make a decision about his political future until the end of the year. That could include running for reelection, launching an independent bid for president or retiring. Manchin has been increasingly critical of the Biden administration and his fellow Democrats in recent months, particularly over energy issues.
“Senator Manchin continues to consider the best way he can serve his state and country,” Sam Runyon, a Manchin spokesperson, said in a statement. “But make no mistake, he will win whatever race he enters.”
West Virginia remains almost entirely reliant on coal for its power, even as other states move toward cheaper renewables and natural gas. The state gets 90 percent of its power from coal, compared with about 20 percent nationally (Greenwire, Jan. 26). In recent months, Justice has fought to keep the state’s largest coal-fired power plant from closing — a move that could cost ratepayers more than $30 million in additional monthly costs.
Justice’s financial disclosures show that his family’s sprawling business empire extends to more than a hundred businesses, including in energy, hospitality, health care, resorts and timber. Justice’s family owns dozens of coal-related businesses based in West Virginia, Virginia, Alabama and elsewhere, his financial disclosures show.
Those companies, many of which operate mines, have faced millions of dollars in fines for air pollution and unsafe working conditions. They have missed numerous deadlines to pay those fines after being sued by the U.S. attorney’s office and the Mine Safety and Health Administration.
Justice has also faced liabilities related to land reclamation on the surface mines owned by his companies. At one time, the Virginia Department of Mines, Minerals and Energy estimated that the companies had about $200 million in such liabilities.
Recently, the Bluestone Coke facility in Alabama, which is owned by Justice’s family, had to pay a fine of almost $1 million for releasing an excessive amount of toxic air pollution that affected a Black neighborhood for years, a ProPublica investigation revealed. The Birmingham facility repeatedly ignored public health concerns, resulting in the largest fine being proposed in the history of the Jefferson County Board of Health.
Justice’s family is considering a sale of Bluestone, The Wall Street Journal reported last month.
In 2009, Justice bought the 6,500-acre Greenbrier luxury resort in White Sulphur Springs and then built a casino underneath it. The resort was home to a secret congressional bunker that has since been decommissioned. He spoke there Thursday evening as he officially announced his candidacy.
The personal ties that Justice and Manchin have to the coal industry may raise questions in such a high-profile race, but that is “not new information for people in West Virginia,” said Conrad Lucas, a former chair of the West Virginia Republican Party.
He said voters have looked at those entanglements and repeatedly elected both men.
Justice, despite his wealth, has cultivated the image of someone who is approachable to the average West Virginian, Lucas said, “despite him being a figure who owns the Greenbrier.”
“He has an ability to connect with voters that you wouldn’t think an incredibly wealthy person would, but voters have found him incredibly relatable,” Lucas said.
Justice is one of the most popular governors in the country. A Morning Consult poll conducted in January found that Justice was the fifth-most-liked governor, with a 64 percent approval rating.
Justice leads Manchin 52 percent to 42 percent among likely voters, according to a poll from the Senate Leadership Fund, the super political action committee aligned with Senate Minority Leader Mitch McConnell (R-Ky.). The only other declared candidate in the race, Rep. Alex Mooney (R-W.Va.), trails Manchin by 15 percentage points, the poll showed.
West Virginia is among the reddest states in the country. Former President Donald Trump, who could once again be at the top of the ticket, won the state by almost 40 percentage points in 2020. The Senate race, and especially the Republican primary, are widely expected to be the most expensive in state history. A poll released earlier this month by National Public Affairs showed Justice outpacing Mooney by 31 points.
Mooney “looks forward to a robust debate of the issues important to all West Virginians including Justice’s record,” his campaign manager, John Findlay, said in a statement before the governor entered the race.
If he wins, Justice would arrive in Washington not as a power broker, as Manchin has been in the closely divided Senate, but as a backbench Republican. His personal wealth and potential for raising campaign contributions could elevate his standing within the Republican Party, but he wouldn’t be the decisive vote on major legislation.
But there are similarities between Justice and Manchin that go beyond making money on coal. Manchin’s close friend and former chief of staff, Larry Puccio, has worked for both men’s campaigns.
At the federal level, Puccio has leveraged his friendship with Manchin to receive lucrative lobbying contracts, as POLITICO’s E&E News has reported. In Charleston, Puccio works as a lobbyist for multiple businesses owned by Justice, including the Greenbrier and Bluestone. Puccio has also worked as chair of Justice’s transition team — as he did for Manchin.
Justice’s extensive business holdings won’t necessarily make him stand out in Congress, said Craig Holman, who lobbies on ethics and campaign finance issues for Public Citizen, the progressive consumer rights group founded by Ralph Nader.
“Lawmakers here in Congress do have very strong conflicts of interest and business interests, and they’re not expected to recuse themselves from votes that affect those interests,” he said. “And it is a conflict of interest, an obvious one, and it’s rather prevalent throughout Congress and not really subject to regulation.”
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( With inputs from : www.politico.com )
Climate advocates say the gains from Biden’s gambit could be as big as the risks. The electric power sector is the nation’s second-largest source of greenhouse gases, so cleaning it up is essential to meeting Biden’s goal of having U.S. carbon pollution reach net zero by 2050. Environmentalists hope EPA will go bold by targeting not just coal, the dirtiest fuel in the power mix, but also natural gas — the reigning champ in the U.S. energy economy.
The EPA and the White House have declined to confirm any details about the rule, which is still undergoing review and could be released as early as next week.
“[W]e have been clear from the start that we will use all of our legally-upheld tools, grounded in decades-old bipartisan laws, to address dangerous air pollution and protect the air our children breathe today and for generations to come,” EPA said in a statement.
‘Considerable risk here’
The Biden administration is already trying to take on the nation’s No. 1 carbon source — transportation — with an EPA auto-pollution rule released just two weeks ago that’s designed to spur a huge increase in sales of electric cars and trucks.
That rule is also at risk of political and legal attacks from Republicans, who accuse the president of endangering the economy by pushing green technologies before they’re ready.
But electric vehicles are already traveling the highways. In contrast, carbon-capturing technology is not yet in place in any active commercial power plant in the U.S., and industry groups argue it’s not ready for wide deployment.
That could make the EPA proposal especially vulnerable in the courts, because the Clean Air Act requires the agency to show that the technologies it proposes are “adequately demonstrated” — not something that might work in the future.
“I think there’s considerable risk here,” said Justin Schwab, founder of the firm CGCN Law and a former EPA deputy general counsel during the Trump administration.
EPA’s rule is expected to set emissions limits for power plants that would in some fashion rely on achieving reductions in line with what carbon capture could achieve, according to people familiar with the proposal. States would then craft compliance plans and could choose other methods that achieve the same reductions, although what those options are remain unclear. The people were granted anonymity to discuss the proposal because the draft rule is not final.
The rule could also require operators of natural-gas-fired plants to reduce their carbon pollution by adding hydrogen to their fuel mix.
“Carbon capture and hydrogen are simply not well established technologies in the way that historical, traditional pollution control technologies have been when they’ve been adopted by EPA on a broad scale,” Schwab said.
Utilities and fossil fuel advocates have long argued that carbon capture and hydrogen could be important technologies for reducing sector emissions — but not for some time, even with recent unprecedented federal investments and incentives.
Climate advocates say the industry needs to put up or shut up.
“The fossil fuel industry says this [technology] is how they stay competitive in a carbon-constrained world. Well, we’re in that carbon-constrained world now,” said Jim Murphy, director of legal advocacy for the National Wildlife Federation. “I think it’s time for the fossil fuel industry to put their money where their mouth is.”
Tom Pyle, president of the pro-fossil fuel American Energy Alliance, accused the administration of issuing an overly aggressive rule that could compel utilities to shutter their coal plants as a political message to environmentalists ahead of Biden’s reelection.
“I think that the end goal is, they’re really just trying to game the system for renewables,” Pyle said.
A 2024 message for both parties
Republicans are eager to tie the upcoming rule and every other Biden climate and energy policy to one of their major themes — the inflation that’s irking Americans and weighing down the president’s approval ratings.
Rules limiting fossil fuels would also align with the GOP’s narrative that Biden is out to shut down traditional home-grown energy, messages they’ve also sounded on gas stoves, oil drilling and cars.
Even if courts nix the upcoming EPA rules, their mere existence could prod utilities to shutter existing natural gas power plants depending on how the agency designs the regulations, said Todd Snitchler, president of the Electric Power Supply Association, a trade group that represents power generators. That would probably feed into Republicans’ broader criticisms of the Biden administration, he said.
“If we are in effect turning off natural gas,” Snitchler said, “I think they’re likely to lean into this to say the administration is raising your prices and jeopardizing power reliability.”
And after delaying action to await the Supreme Court’s ruling last summer, the EPA also has little time to defend the rules in court should Biden lose his reelection bid.
“These things are about the campaign,” said Republican energy lobbyist Mike McKenna. “That’s why they waited until year three.”
But going small would also carry risks by causing the U.S. to miss its climate goals, and it would turn off supporters Biden needs in 2024.
“The whole Biden coalition is built around this commitment” on climate change, said Dallas Burtraw, a senior fellow with the think tank Resources for the Future. He noted that the administration got Congress to pass a climate law last year that offers big incentives for clean power as well as hydrogen and carbon capture.
While the climate effort may drive enthusiasm among Biden’s green supporters, Senate Democrats’ hopes of keeping their slim majority depend on defending their turf in moderate states. Some, such as West Virginia, Michigan, Montana and Ohio, are home to big workforces in the automobile, coal and natural gas sectors.
Biden found a balance in the 2020 campaign, winning the blue-collar-heavy swing states of Pennsylvania, Michigan and Wisconsin while promising to eliminate carbon pollution from the power grid by 2035. At the time, he said carbon capture and hydrogen technology could give a lifeline to power industry workers. Few of Biden’s Democratic primary rivals shared that vision.
“The public fully understands that fossil fuels are creating pollution that is harming communities across the country,” said Matthew Davis, senior director of government affairs with the League of Conservation Voters, addressing questions about the upcoming EPA rules. “There is also a need to emphasize how important it is that we transition in a way that helps workers that are in those sectors.”
Some energy experts say electricity generation doesn’t offer Republicans the same potent weapon that Biden’s other green energy moves do.
“It doesn’t hit home to a driver or a homeowner as much as a gas stove or an electric car does,” said Frank Maisano, who represents energy clients at the law firm Bracewell. “I suspect most people don’t know they’re already getting a lot of renewable power because the sector has transitioned much faster than expected.”
But will it work?
For utilities, forthcoming investments and incentives from the federal government mean carbon capture could one day be an effective way to reduce power plants’ impact on warming the planet.
But the big question is whether it can do that now.
Only two commercial-scale coal-fired power plants in North America have installed carbon capture technologies: Petra Nova in Texas and Boundary Dam in Saskatchewan, Canada. Both projects experienced cost overruns and performance issues that caused them to miss their targets, and Petra Nova shut down after a few years in operation.
That means the technology flunks the Clean Air Act’s “adequately demonstrated” test, Bracewell attorney Scott Segal argued.
On the other hand, EPA has previously set standards that require industries to invest in new types of pollution controls, said Dena Adler, an attorney with New York University’s Institute for Policy Integrity.
“The history of the Clean Air Act is filled with regulations where technologies were projected to be very expensive,” she said. “And after the regulations came down, industry figured out how to install these control technologies better and cheaper.”
But installing the technology isn’t the only hurdle. Requiring large amounts of carbon capture will also raise questions about what to do with all the CO2.
Oil producers can use carbon dioxide in “enhanced oil recovery” wells in which CO2 is pumped underground to push out difficult-to-reach oil — although those are mostly clustered in Texas, California and a few other states. It can also be pumped underground into geological formations.
Either option would probably require many new pipelines to be built to carry the gas to its destination — at a time when permitting is taking longer and the public increasingly opposes them.
Running carbon capture technologies also requires a significant amount of power, as much as 20 percent of a plant’s electricity output, the Congressional Research Service said last fall. Petra Nova powered its carbon capture equipment by building a 75-megawatt natural gas unit onsite, the emissions from which dampened the carbon reductions achieved by the coal-fired unit.
“If EPA wants its rule to survive, it needs a substantial basis in the record that its assumptions about the feasibility of the adoption of this technology have a real basis and that it’s not just pie in the sky,” said Schwab.
Similarly knotty questions surround the possibility of utilities burning hydrogen alongside natural gas — another promising but unproven technology that they could use to comply with the upcoming rule.
SCOTUS’ shadow hangs over the rule
The courts may have the final say on EPA’s rule — as they did in knocking down both Obama’s power plant regulation and the Trump administration’s attempt to replace it.
The Supreme Court last summer split along ideological lines in striking down the Obama-era Clean Power Plan — while embracing a legal doctrine that forbids agencies from deciding “major questions” that legally rest with Congress. That doctrine doomed the Obama rule, which had pushed for a broad shift by utilities away from coal.
Biden’s foes could argue that his rule similarly runs afoul of the same legal standard if it effectively prompts utilities to shutter their coal plants.
But some legal experts see a bright spot for Biden in last year’s EPA ruling.
For one thing, NYU’s Adler said, an EPA standard based on carbon capture would be “entirely different” from the Obama regulation’s demand that utilities switch to cleaner fuel sources. Capturing pollution at the source “is really the bread and butter of the Clean Air Act and the type of regulation that EPA has been issuing for decades,” she said.
In addition, while Congress hasn’t explicitly changed EPA’s regulatory authority, Democrats have passed major investments as part of the 2021 bipartisan infrastructure law and the 2022 Inflation Reduction Act. Those laws provided billions of dollars in research grants for carbon capture and hydrogen, plus expanded tax credits to encourage adoption of those technologies.
But EPA can’t rely on those federal dollars to justify a more stringent regulation, said Schwab, the Trump-era agency veteran. He said it’s not clear the Clean Air Act even allows EPA to consider the availability of the money, and much of the funding may never materialize if a future Congress and administration undo the Biden-era laws It’s unlikely that all of Biden’s many climate rules will survive Supreme Court scrutiny, environmental and energy lawyer Michael Buschbacher said in an email this week to POLITICO’s E&E News.
“The Biden administration appears to just want something to stick, essentially scaring industry into self-regulating,” wrote Buschbacher, a partner at Boyden Gray & Associates. He added, “This approach could backfire spectacularly.”
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( With inputs from : www.politico.com )
The Group of Seven richest countries set higher 2030 targets for generating renewable energy, amid an energy crisis provoked by Russia’s war on Ukraine, but they set no deadline to phase out coal-fired power plants.
At a meeting hosted by Japan, ministers from Japan, the U.S., Canada, Italy, France, Germany and the U.K. reaffirmed their commitment to reach zero carbon emissions by the middle of the century, and said they aimed to collectively increase solar power capacity by 1 terawatt and offshore wind by 150 gigawatts by the end of this decade.
“The G7 contributes to expanding renewable energy globally and bringing down costs by strengthening capacity including through a collective increase in offshore wind capacity … and a collective increase of solar …,” the energy and environment ministers said in a 36-page communiqué issued after the two-day meeting.
“In the midst of an unprecedented energy crisis, it’s important to come up with measures to tackle climate change and promote energy security at the same time,” Japanese industry minister Yasutoshi Nishimura told a news conference, according to Reuters.
The ministers’ statement also condemned Russia’s “illegal, unjustifiable, and unprovoked” invasion of Ukraine and its “devastating” impact on the environment. The ministers vowed to support a green recovery and reconstruction in Ukraine.
They also published a five-point plan for securing access to critical raw materials that will be crucial for the green transition.
Before the meeting, Japan was facing criticism from green groups over its push to keep the door open to continued investments in natural gas, a fossil fuel. The final agreed text said such investments “can be appropriate” to deal with the crisis if they are consistent with climate objectives.
The ministers’ meeting in the northern city of Sapporo comes just over a month before a G7 leaders’ summit in Hiroshima.
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( With inputs from : www.politico.eu )
Chennai: Tamil Nadu BJP President K. Annamalai has thanked the Union government for removing Tamil Nadu from the coal auction list.
Annamalai in a tweet said, “We thank our Hon PM Thiru@ narendra modi avl &Hon minister Thiru@ JoshiPrahlad avl for considering our request and removing the coal blocks in TN’s Delta region from the coal auction list.”
Union Coal Minister Prahlad Joshi had on Saturday tweeted that the decision to exclude Tamil Nadu from the coal auction list was taken in the interest of the people of the state after the BJP Tamil Nadu unit president, K. Annamalai had informed him of the issue.
The Union Minister in the tweet said ,”@BJP4Tamil Nadu Pres.@annamalai-k rushed to call upon me in Bengaluru with request to exclude 3 lignite mines from auctions in 7th tranche. In spirit of cooperative federalism and keeping in mind the interests of the people of TN, I have directed to exclude them from auction.”
It may be noted that the Tamil Nadu Chief Minister MK Stalin, while speaking on the issue, had asserted that his government would never allow coal mining in the fertile Delta region of Tamil Nadu.
Hyderabad: The Singareni Collieries Company Limited (SCCL) produced 671 lakh tonnes of coal in the fiscal year 2022–2023 and set a record for the highest annual amount of production.
SCCL transported roughly 667 lakh tonnes of coal, which is 2% more than the previous year. In addition to this, it has provided coal to thermal power plants in eight other states and to over 2,000 different sectors nationwide, a press note informed.
SCCL Chairman and Managing Director N Sridhar stated that on March 31, Singareni transported 2.64 lakh tonnes of coal, the most in its history, breaking the previous record of 2.59 lakh tonnes set on March 11, 2016.
The business has set a target of 750 lakh tonnes of coal production for the fiscal years 2023–2024 after being encouraged by the coal production turnover achieved during the current fiscal, he added on Saturday.
According to Sridhar, Singareni has also broken a record by removing 418 million cubic metres of overburden during the current fiscal year, which is 7% more than the 392 million cubic metres attained in 2017–18.
Sridhar stated that five of the total 11 coal mining locations under Singareni had exceeded their goals by a large margin. He added that the underground mines also performed well during the current fiscal, with 8 mines achieving more than 100% production.
He said the performances of open-cast mines were also very encouraging, with 11 out of 18 open-cast mines, which are the main sources of coal production in Singareni, achieving 100% production.
Durg: A woman was allegedly made to walk on burning coal and iron nails by her husband’s relatives to prove that she did not practice black magic in Chhattisgarh’s Durg town, police said on Saturday.
The woman, who sustained burns on her legs, was hospitalised after the incident that took place in Kailash Nagar area of the town on March 20, an official said.
The police have arrested two women and a man, and detained a minor boy, who claimed to be a tantrik, he said.
Talking to PTI, the victim, Mamta Nishad, a resident of Karidih locality here, claimed that her husband’s younger brother, his wife and her elder sister-in-law used to harass her by accusing her of being involved in witchcraft.
On the night of March 20, when her husband was away, the trio allegedly took her to a tantrik in Kailash Nagar and asked her to prove that she did not indulge in black magic, she alleged.
The victim claimed that the tantrik had made her walk 12 times on burning coal and nine times on a bed of iron nails. The victim informed her husband about the ordeal, following which a police complaint was lodged.
A case under sections 324 (voluntarily causing hurt) and 34 (common intention) of the Indian Penal Code and provisions of the Chhattisgarh Tonhi Pratadna Nivaran Act has been registered, City Superintendent of Police (CSP) of Durg area Vaibhav Banker said.
The three accused relatives were arrested and the tantrik, who is a minor, was detained, he said, adding that further investigation is underway.
The victim, however, raised questions about the police action after the accused were granted bail by a local court and demanded stern action against them.
Ranchi: The Income Tax (I-T) Department has unearthed a stock of 22,000 metric tonne of coal during raids conducted at the premises of Agriti Minerals Private Ltd, a Jharkhand-based company involved in the business of mining products.
During investigation, it was revealed that the coal was meant to be supplied to two power plants in the state, but instead was illegally dumped by the company. The coal was stored at the company’s bases at Kuju town in the Ramgarh district.
In the assessment done by the I-T Department, it has been revealed that the value of illegally dumped coal at the company’s premises is Rs 23.75 crore. The department had conducted a survey on March 20-21 at the company’s locations in Ranchi and Kuju.
During the survey, it was found that the company has a huge stock of coal at its premises as compared to the details entered in its stock register. The evaluation of this stock was done by the experts of Central Mine Planning and Design Institute (CMPDI), a Central government company.
Investigation revealed that this coal was to be supplied to Maithon Power Limited and Koderma Thermal Power Limited, but the company dumped it. The plans were to illegally sell the coal at high prices in the market.
The businessman running the company has also accepted the proof of having an undisclosed income of Rs 4.5 crore. He has also agreed to pay a tax of Rs 1.5 crore to the I-T Department.
New Delhi: The government has not set up any committee to probe allegations a US short seller labelled against the Adani Group, but stock market regulator SEBI is investigating market allegations against the group, the Lok Sabha was informed on Monday.
A separate investigation into imports of Indonesian coal by the conglomerate hasn’t reached finality, Minister of State for Finance Pankaj Chaudhary said.
Lok Sabha saw several questions being put by MPs to the government on the Adani issue, which were replied through written responses by the minister.
To a question asking if the government had constituted any committee to investigate allegations made against the Adani group by Hindenburg Research, he said, “No”.
In the January 24 report, US short seller Hindenburg Research alleged that the Adani group was “engaged in a brazen stock manipulation and accounting fraud”, and used offshore shell companies to inflate stock prices.
The group has denied all Hindenburg allegations, calling them “malicious”, “baseless” and a “calculated attack on India”.
To a separate question, Chaudhary said the nine listed companies forming part of Adani group saw a 60 per cent decline in market capitalisation from January 24, 2023 till March 1 subsequent to the publication of the Hindenburg report.
On the allegations, he said the Securities and Exchange Board of India (SEBI), as the statutory regulator of securities markets, is mandated to put in place regulatory frameworks for effecting stable operations and development of the securities markets including protection of investors.
“As per its mandate, it conducts investigations into any alleged violations of its Regulations by any market entity,” he said. “It is, accordingly, undertaking investigation into the market allegations against the Adani Group of companies.”
He, however, did not give details.
To a separate question on investigation by the Directorate of Revenue Intelligence (DRI) into import of power generation and transmission equipment by Adani, he said the probe has “concluded” and the “report has been submitted before the relevant judicial authorities”.
He, however, did not reveal the findings.
On the alleged irregularities in imports of Indonesia coal by the Adani group companies, he said, “investigations by DRI have not reached finality as information sought from exporting countries through execution of Letters Rogatory (LRs) is under litigation.”
In January 2020, the Supreme Court paved the way for DRI to investigate allegations of overvaluation of coal imports from Indonesia by the Adani group. The apex court through the January 9, 2020, order stayed an October 17, 2019 judgment of the Bombay High Court which granted relief to Adani group by quashing LRs sent to various countries including Singapore, seeking details of the group’s coal imports from Indonesia.
On the Hindenburg allegations, Chaudhary said SEBI had told the Supreme Court that it was “already enquiring into the allegations made in the Hindenburg report as well as the market activity immediately preceding and post the publication of the report, to identify violations of SEBI Regulations including but not limited to SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, 2003, SEBI (Prohibition of Insider Trading) Regulations, 2015, SEBI (Foreign Portfolio Investors) Regulations, 2019, Offshore Derivative Instruments (ODI) norms, short selling norms, if any.”
The apex court on March 2 directed SEBI to conclude the investigations within two months. It also constituted an expert committee for the assessment of the extant regulatory framework and for making recommendations to strengthen it.
The minister said the government had suggested to the apex court that the expert committee should look into Hindenburg allegations as well as undisclosed short positions taken on Adani stocks.
The nine Adani group companies, which lost 60 per cent market value after Hindenburg report, are part of BSE Sensex and have a combined weight of below 1 per cent in Nifty, he said.
“The volatility in the stocks of these companies have not had any significant impact at the systemic level. Nifty 50 declined by around 2.9 per cent in the month of January 2023 and by around 4.9 per cent in the 2-month period of January and February 2023,” he said.
The minister said the pricing of individual stocks and variations, over or undervaluation, and the price risks borne by investors are determined by the dynamics of demand and supply.
“The regulatory framework provides for surveillance mechanisms which are triggered in instances of volatility in share prices of specific companies.”
On exposure of state-owned Life Insurance Corporation of India (LIC) to the Adani group, he said the country’s largest insurance company had Rs 6,182.64 crore outstanding loans to the conglomerate as on March 5, 2023.
“The five public sector general insurance companies have informed that these companies do not have loan/credit exposure to Adani Group of companies,” he said.
“Public sector banks have informed that loans are sanctioned after assessing the viability of projects, prospective cash flows, risk factors and availability of adequate security and repayment of loans are ensured by the revenue generated by the project and not by the market capitalisation of the company.”
He referred to LIC’s January 30 statement to answer questions over the company’s investments in Adani stocks.
In that statement, LIC had said it had over the years purchased shares in Adani group companies for Rs 30,127 crore and its exposure to the conglomerate was 0.975 per cent of its total AUM at book value.
Public sector general insurance companies – New India Assurance Company Ltd, United India Insurance Company Ltd, National Insurance Company Ltd, Oriental Insurance Company Ltd and General Insurance Corporation of India – had a total exposure of Rs 347.64 crore in Adani Group of companies as of January 31, 2023, which is 0.14 per cent of the total AUM of all the five companies, he added.
