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Supreme Court's verdict on coal block allocation good for power sector!
The Supreme Court on Monday pulled up the Centre on coal block allocations and declared all 218 allocations made from 1993 to 2011 illegal and arbitrary. A bench of Chief Justice R.M. Lodha and Justices Madan B. Lokur and Kurian Joseph have finalized this judgement.
The judgement is given with regards to the Coal allocation scam, popularly known as Coalgate, which is a political scandal concerning the Indian government's allocation of the nation's coal deposits to public sector entities and private companies by the former governments.

How the Supreme Court verdict on Coal block allocation going to impact the power firms? Are we going to face blackout in coming days as in the absence of coal, the power generation would be hampered? What will be the impact on overall economy?

When we talked to power experts on this issue, they were like the verdict won't directly affect the power firms.

Rajiv Kakaria, a noted expert on power sector has hailed the apex court's verdict while saying that with this decision the coal resources which were so far hidden by the companies will come out in the market to be utilized in the interest of the nation.

"If it impacts at all then it would be in the long run, because anyways all the blocks that would either be put up for re-sale or it would be bringing out the blocks which were lying dead. I think this is going to further speed up. And I believe that it will bring lot of coal back into the market as the people were just sitting on that and were waiting for the golden opportunity to sell them at higher prices. All that will come into the open market and government process will speed up. I think it is a long term good news for us," said Rajiv Kakaria.

He also added that the verdict will help in transparent sale of the coal blocks to the end users, but not the speculators.

"Now the coal blocks will be available for sale in a transparent manner, where the final end users will come and get it not the speculators. The power sector was doing very well till 2006, but suddenly it put the brakes on, because the people just took the coal blocks and they sat on them. I think it will boost the infrastructure. May be their will be small setbacks, but will help in sorting out the power problem in the country," said Kakaria.

All India Power Engineers Federation (AIPEF), feels that bankers will suffer because of the judgment not the power sector.

V K Gupta, spokesperson for AIPEF said, "The biggest losers in the whole process will be the banks, as the banks have given them some 1000 crores of loans. And the power sectors won't have any negative effect because of this judgment."

While, DH Pai Panandiker, a noted economist has said that the judgment may prove 'damaging judgment for the economy'.

He said, "I think it is a very significant decision, and also a very damaging judgment for the economy. The court has to keep this in mind and ensure that whatever they do, the operations at the mines do not get disturbed."

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