While the directive from the Prime Minister's Office (PMO) to sign the fuel supply agreements (FSAs) with power firms might have come in as a jolt for Coal India, power companies cheered the move which has come in as a huge relief for the sector, which is currently reeling under raw material shortages.
The PMO has directed Coal India to arrange to meet coal demand in case of shortfall. Also, the company will have to provide coal for 50,000 MW of power capacity and supply around 200 MT coal in the next 3-4 years.
Shares of Coal India were down more than 5 per cent on concerns of falling margins over assured coal supply to power producers on Thursday.
Speaking to NDTV Profit on the PMO decision, Zohra Chatterji, Chairperson and Managing Director of Coal India said that the company will have to evolve a new strategy to deal with the decision.
"We will now need to be efficient with our workforce to ramp up production. We will start looking at long term supplies from abroad for imports. However, we haven't got any communication from PMO that we will be penalised,” she clarified.
Below is the complete interview. Also watch the accompanying video.
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