Government claims of windfall gains from coal auction lack clarity (Nitin Sethi & Ishan Bakshi, Apr 21, 2015, Business Standard)

Image result for coal auction in in india(Nitin Sethi & Ishan Bakshi | New Delhi Apr 21, 2015 in Business Standard)

The Narendra Modi-led National Democratic Alliance (NDA) government has made much of its claim that state governments stand to make windfall gains, upwards of Rs 2 lakh crore, from auction of coal blocks – more than the loss to the exchequer, as estimated by the Comptroller and Auditor General (CAG), because of random allocation of blocks by the previous government.

Clearly, an auction will generate larger sums than the allocations did during the United Progressive Alliance (UPA) regime, when states got only the royalties. But the government’s claims over the auction proceeds do not seem to stand the test of a closer scrutiny.

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