Indian unions call strike to protest FDI in coal industry

miningweekly.com General,  International 2019-09-11 10:24:58

Trade unions representing workers in the Indian coal mining industry have announced a strike for September 24, to protest the recent government decision to allow 100% foreign direct investment (FDI) in domestic commercial coal mining.


The day-long strike, announced by the five trade unions, is a precursor to prolonged agitation unless the government rolls back a decision to open up the sector to overseas private miners.


Trade unions affiliated to all major political parties, including Indian National Congress and Communist Party of India, represent workers in State-run Coal India Limited (CIL) and Singareni Collieries Company Ltd (SCCL). However the labor arm of the Bharatiya Janata Party, the ruling party in New Delhi, would not be joining the protest.


Earlier this year, the Coal Ministry opened up commercial coal mining for private miners thereby ending coal industry nationalization since 1973. However, to push privatization of the industry further, the Ministry last month amended regulations permitting 100% FDI in commercial coal mining, which would enable global mining majors to invest in the Indian coal industry through wholly owned subsidiaries.


The major trade unions in the industry have launched protests against the move, claiming that the advent of international investors would impact on CIL's and SCCL's revenue, leading to the erosion of the competitive edge of government mining companies, loss of consumers and pricing power with the brunt of this being borne by workers.


"As government mining companies lose revenue, it is the workers who will eventually bear the brunt and wages, bonus and other payments may be impacted. Besides, its approach towards workers will become more conservative as government companies will try to control costs," a trade union leader said.


The trade unions reckon that any international resource major investing and developing coal projects in the country would deploy higher levels of mechanization to improve productivity at lower wage costs. This would not only lead to lower cost of production for foreign mining companies, but also erode the cost competitiveness of government coal companies.


CIL has an estimated wage bill of about $5.35 billion a year and to remain competitive, the government miner would have to curtail wages and bring down the cost of production, which would threaten jobs in the sector, the trade union leader said.


(Writing by Becky Du  Editing by Tammy Yang)
For any questions, please contact us by inqury@fwenergy.com or +86-351-7219322.

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