Aeman Nishat finds India’s coal capital low on supplies and struggling against cheap Australian imports.
India coal capital is getting a facelift it does not want. For years, sorry, decades, Dhanbad drove much of India's industrial revolution and helped trade boom in eastern India. But today, despite green, overhead welcome signboards set up by the Jharkhand government welcoming visitors, not many are keen to have Dhanbad as the site for their new ventures. No one, at this point of time, is saying Dhanbad is unimportant to India. But the coal capital is surely in the throes of a continuing exodus of industrialists shifting their manufacturing facilities to greener pastures available in coastal states. Why won’t they? Bharat Coking Coal Limited (BCCL), the subsidiary of the stateowned Coal India Limited (CIL) is struggling to increase production and meet growing demands. Worse, it has routinely drawn flak for providing sub-standard coal (read with high ash content), prompting many to opt for gas-fired plants outside the state.
Till a decade and a half ago, the portion of the Grand Trunk Road passing through Dhanbad used to be dotted with coke factories – the region’s backbone — between Gobindpur and Nirsa right outside Dhanbad. But today, this very patch is home to ghostly factories whose high metal gates sport rusty padlocks and chimneys home to hundreds of pigeons. The workers have all gone. For the records, the number of coal-based factories in this belt is just 200 as against a little over 500 just 15 years back.
In nearby Nirsa, the most industrialized zone in Dhanbad and once home to hundreds of hard coke factories, the scene is equally grim. Aparna Sen Gupta, the local Forward Block legislator wants to implement a game plan that will revive Nirsa's increasing number of sick industries but has little support from the state government. What’s the core issue that’s bugging Dhanbad? It’s primarily the insurmountable crisis in coal linkage that has forced many of Dhanbad's hard coke plants to down shutters and shift base. Why would you stay if you do not get enough coal from BCCL? You are always short in supplies and worse, over 50 percent of the coal offered by BCCL is of low grade and cannot be converted into hard coke.
“I do not want to open any new venture in Dhanbad, not even in Jharkhand. This place is fraught with hundreds of problems,” says S K Sinha, a prominent local industrialist and head of the B.D. Sinha group of companies. He shifted one of his hard coke plants to the port town of Mundra in Gujarat in 1994 and transferred over 1,000 workers from Dhanbad. This plant, run by Sinha's Rs 3,500-crore Saurashtra Fuels Pvt Ltd, has a production capacity of 1.5 million tones and is the largest private sector coke plant in India. Sinha also shifted another 1,000 s. He also shifted 1,000 workers to Kutch when he set up his second plant in Gujarat in 2003.
A quintessential hard coke entrepreneur, Sinha recently acquired a coal mine in New Zealand and runs two in Dhanbad — Brahmdev Sinha & Company with a monthly capacity of 5,000 MT and Rajganj Coke Producers with a monthly capacity of 2,500 MT and a few refractory plants. "Jharkhand does not have comprehensive industrial policy seven long years after its bifurcation from Bihar," adds Sinha. Dhanbad Chamber of Commerce and Industries (DCCI) president B.N. Singh laments hard coke units with monthly quota of 10,000 MT have been getting only between 2,500 MT and 3,000 MT a month for the last eight years. “The crisis renders thousands idle before they inevitably get retrenched,” says Singh.
There are other regions for Dhanbad's coal-based industries losing their sheen. Indian coal is now increasingly been seen as a costlier option as compared to the imported variety from Australia. The price is cheap and the quality world class. So why seek Indian coal? “BCCL’s coal’s ash percentage is between 20 to 30 percent and, when converted, grows to 40 percent,” says Rajesh Ritolia of the BD Sinha and Group. Imported coal does not give you such tensions.
Dhanbad has other tensions. Those currently in operation do not want to shift base despite low supplies. “The norms for investment are too inflexible and there is this suffocating red tape," says a senior functionary of the Bank More Chamber of Commerce and Industries (BMCCI), one of Dhanbad's over 20 industry bodies. Problems in land acquisition – complicated by the mafia-driven spiraling prices — have also discouraged many entrepreneurs.
Once hard coke manufacturing units in Dhanbad district numbered over 150. Today, the number now is less than 100, bulk of them closing operations because of continued failures in coal linkage. Among those who will down shutter any day are Foundry Fuels Products, Akash Coke Industries and Aroma Coke. The total annual turnover here has stagnated at Rs 500 crore for over five years despite a nearly three-fold hike in the price of hard coke and countrywide increase in its demand. Similar is the case with the refractories, which produce high-alumina and fire bricks used for construction of high-temperature zones inside steel plants, coke plants and the glass-making units. Once, they Dhanbad had over 60 operational refractories. Today, there are only 35.
In nearby Jharia's coalfields, there are huge reserves of quality coal — considered India's best quality — with lower ash content. But who will mine it? You first need to evacuate hundreds of thousands living in the region that has the world’s largest underground mine fires that rages till date. "Getting coal from Jharia through open cast mining seems impossible due to this herculean task of evacuation,” says a veteran industrialist requesting anonymity.
Agree Diptendu Mukherjee, a noted Dhanbad-based labour lawyer with definite Leftist leanings: “Once there were over two lakh workers in Dhanbad's coal-based industries, now the number has come down to less than a lakh. It is indeed a matter of concern.” In fact, the low number game is the new face of Dhanbad. And the city does not want it.
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