KOLKATA (miningweekly.com) - The Indian government’s uncertainty over its economic philosophy and the policy it prefers with regard to the role of the private sector in mining has surfaced once again, with two wings of the government striking discordant notes.

In the last 24 hours, a Minister in the federal government accused private miners of being the biggest threat to indigenous people and the cause of the rise in ultra-left-wing extremism.

Simultaneously, the head of the country’s Planning Commission has advocated repealing laws that nationalized the country’s coal sector to pave the way for the entry of private miners.

Ironically, at a high-level meeting convened by the Planning Commission last week, the government concluded that concerted and coordinated policy and administration could lead to India attracting foreign investments of $30-billion in the mining sector in the medium term.

“The issue of mining by corporations in scheduled areas is the biggest challenge and threat that is looming large on tribal communities today,” federal Minister for Tribal Affairs, V Kishore Chandra Deo said.

“There has been resurgence of left-wing extremism in some tribal areas where corporations have mining interests,” he noted.

Citing media reports, he added that there were companies that were sending large sums of money for mining in the Chattisgarh province and these companies should be held equally responsible for the rise in extremism and violence in such regions.

“How can a company which is neither owned nor controlled by tribals take a mining lease or buy land in these areas?” the Minister questioned.

Reflecting a contrary view, the deputy chairperson of the Planning Commsion, Montek Singh Ahluwalia, said, “I think nationalisation of coal should be repealed”.

Under the Indian Coal Nationalisation Act, commercial mining of coal was permitted only by government-owned companies like Coal India Limited.

“I think that our policy on coal is basically inconsistent with the policy of every other energy source. In petroleum and natural gas you allow the private sector. In coal you do not. Both the other resources are actually more valuable. Coal nationalisation is just historical legacy and needs to be controlled,” Ahluwalia said.

On Tuesday, a member of the Planning Commission, B K Chaturvedi, called for greater private-sector participation in the Indian coal sector and urged the government to ensure private-sector investments in coal mining.

However, explaining the differing ideologies within the government, an official in the Coal Ministry pointed out that this was a reflection of divergence between those in the government and those that constituted the structure of the political party and were the power behind the government.

While sections within the government backed a greater role for private capital in the economy, the Congress Party, which headed the ruling Indian coalition government, would find it politically difficult to repeal such resource nationalism with its left-of-center leanings, as the party was the architect of coal nationalisation in 1973.