One of the largest trade unions in India has decided to approach the Supreme Court to contest the government’s decision to allow private companies in the coal sector, saying the move will lead to job losses, lower salaries and loss of market share for Coal India.
The Indian National Trade Union Congress said it won’t participate in a strike called by four other central trade unions at Coal India next month because it plans to seek political support from non-BJP parties against the government’s move. State-owned Coal India accounts for more than 80% of the country’s coal production.
The Centre of Indian Trade Unions, Bharatiya Mazdoor Sangh, Hind Mazdoor Sabha and All India Trade Union Congress served notice on Tuesday for observing a day’s strike on April 16 to protest the opening up of the coal sector to commercial mining and sale without any restriction.
“A day’s strike will serve no purpose at the moment. We have already started consulting lawyers on the issue and we would definitely move the Supreme Court against the government’s decision,” said SQ Zama, secretary general of the Indian National Mineworkers’ Federation under INTUC. “The Centre had assured us that Coal India’s interests would be protected. However, allowing commercialisation effectively means turning back on its own commitment.”
INTUC members at Coal India will work on April 16, Zama said. “We are against commercialisation and opening up of the coal sector to private players and to begin with, would be observing a day’s strike on April 16,” said BK Rai, representing workers on behalf of BMS at Coal India. “It would be a token strike, while further course of action would be decided on the basis of the government’s reaction to the move.”
The Cabinet Committee on Economic Affairs approved the opening up of commercial coal mining for the private sector last month, calling it the most ambitious reform in the sector since it was nationalised in 1973. There will be no restriction on the sale and utilisation of coal. The decision is expected to bring efficiency into the coal sector by moving from an era of monopoly to competition.
The unions oppose commercialisation primarily because of high wage costs at Coal India – 55% of the state-owned miner’s cost of production is on account of labour compared with 25% for private companies. Workers at Coal India get an average salary of Rs 40,000 amonth while their counterparts in the private sector receive at most Rs 20,000 a month. The unions fear Coal India will not be able to compete with private miners on a cost basis.
“Workers at Coal India receive the best salaries along with social security, medical reimbursements, retirement compensation and cashless treatment after superannuation to some extent,” Zama said. “Workers in the private sector are denied such benefits. This is why our cost of production is high. They will exploit workmen, sell coal at lower costs and would eventually kill Coal India.”
Coal India’s net sales were Rs 75,600 crore ($11.7 billion) in 2016-17, when it produced 554 million tonnes of coal, according to the company’s annual report. According to Zama, the problems faced in the pre-nationalisation era will return if private companies are allowed to mine coal and sell it in the open market.