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Thursday, 05 April 12
COAL EXPORT TAX: MATTER OF CONCERN FOR INDIA - SUNIL K KUMBHAT
 COALspot.com - Since the issuance of Indonesian Mining law in 2009, miners have increased their activities in exploring , exploiting and exporting all types of minerals,specially Black Gold –Coal.
In order to regulate the mining sector , the Goverment of Indonesia has announced a series of new mining regulations, including a ban on exports of some unprocessed metals and low-grade Coal from 2014 , which is designed to spur investment in mineral processing .The proposed ban on exports of coal under the 5,700-kcal/kg from Jan 2014 will change the dynamics of the global thermal coal market, which has seen spiralling demand from China and India. Such a ban will have a substantial impact on the thermal coal market, as large amounts of low-quality coal from Indonesia are exported to India and China.
Another Goverment regulation known as GR 24 of 2012 ( Amendment of GR 23 of 2010 ), signed by President of Indonesia on Feb. 21,2012 stipulates that foreign shareholders/ Companies must gradually divest 51 percent of their shares in local mining companies to local investors after the fifth year of commercial production and complete the divestment by the 10th year of production. The divestment regulation resulted from a revision to a earlier GR 23 of 2010 that required foreign shareholders in local mineral and coal mining companies to divest 20 percent of their holdings.
In a latest move The Goverment of Indonesia now plans to impose a tax of 25% on export of coal and base metals during the current year, and increase it to 50% in 2013. The step is to boost investment in the downstream industry of metal and mining sectors. It is also expected to restrict the exports of mineral and ore metal shipment.The date of implementing the regulation and calculating the Export tax is yet to announced.
Indonesian Government is capitalizing on the mining boom driven by high demand of thermal Coal from China and India . Inspite of series of Taxes , the proposed Export tax is designed to restrict the production and also share profit on the minerals being mined. Coal prices are increasing due to huge requirement and inadequate global production capacity. Govt of Indonesia is encashing the Global situation of demand and supply .Coal will remain hot commodity and Indonesia as heart of Coal Boom.
If the proposed tax is implemented , it is definitely cause of serious concern , particularly for Indian buyers. India is a major buyer of Indonesian thermal coal, along with are China, South Korea, Japan .This is a wake-up call for all the foreign miners operating in Indonesia specially for Coal, that gone are the days of soft and flexible regulations.It is also wake up call for country like India that slow environmental ,forestery clearances and land acquisition issues ,if not sorted out will led to stagnating coal production in India which will resultinto increased dependence on imports, specially from Indnonesia , Australia and south Africa.
Never before India has such a high demand for coal, so also environmental consciousness been so high. Both are legitimate & serious issues but the solution is not to clamp down on coal production. India’s soaring energy need is vital for its industrial growth.
The magnitude of growth in power generation in India will necessarily mean that coal demand will remain very strong. Coal will remain life line for Indian economy for coming many decades till identifying an alternative source that can match coal in its accessibility, availability and affordability in the context of scale of capacity addition required in India.
As the situation stands today, India could become the world’s biggest thermal coal importer by 2015 and Indonesia would be one of the Countries to take care of bulk of coal requirement.
India is today one of the fastest growing economies and also has a shortage of power supply. Indonesia is one of the countries with huge natural resources and exporting thermal coal to many countries for use in power plants for generating energy but it is paradoxical that Indonesia is short of energy. Many Indian companies are capable of sharing power technology and setting up mega power plants in Indonesia
Indonesian private companies can buy equity stakes in India’s power plants in exchange for long-term coal supply. Since India is today one of the fastest growing economies and also has a shortage of power supply then such deals can be beneficial to both parties.
Indonesia requires huge investment from foreign investors in infrastructure, Power Generation, Oil & Gas exploration, telecom sector, Port and Rapid transport system. So it is essential to have transparency in all regulations, legal system and improvement in corporate Governance. Indonesia's mining industry is undergoing a regulatory overhaul which may weaken the operating health and financial performance of many domestic mining companies.
Besides increased operating uncertainty, the new regulations of recent past & proposed may also make the mining industry less attractive to foreign investors. Foreign investor is likly to seriouly question the Safety and Security of their investment in mining sector considering the regulations of the recent past. Lack of transparency in the legal process and the risk of regulatory duplication and inconsistencies will continue to act as deterrents to substantial investment ,specially foreign direct investments (FDI).
As the situation stands today next couple of years shall be very challening for foreign companies operating in Mining sector in Indonesia.
The present proposed tax would hit the profits of both domestic and foreign-owned companies and would heavily raise costs for importers.
The market analysts and experts in mining sector are skeptical about all the mining regulations and plans announced in recent past.
By: Sunil K Kumbhat , Jodhpur (Rajasthan) India
Views expressed herein are personal views of the author and not that of COALspot.com.
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Wednesday, 22 November 23
INDIA: GOVERNMENT PLANS 1.4 BILLION TONNE COAL OUTPUT BY 2027 - LIVEMINT
The Union coal ministry on Monday announced plans to increase India’s coal production to 1.404 billion tonne by 2027, with an eye to further ...
Wednesday, 22 November 23
OBLIGATION. INDONESIA AIMS TO START COLLECTING LEVIES FROM COAL MINERS IN JANUARY - REUTERS
Indonesia plans to start collecting levies from coal miners in January to be used to compensate miners who sell coal to the state utility at lower ...
Tuesday, 21 November 23
INDIAN COAL POWER PLANTS’ CAPACITY UTILISATION WILL IMPROVE TO 65% THIS FISCAL: - CRISIL
Coal-based thermal power units’ plant load factor (PLF) or capacity utilisation will improve to 65 percent in the current fiscal year despite ...
Tuesday, 14 November 23
CAPITAL PRODUCT PARTNERS L.P. ANNOUNCES TRANSFORMATIVE TRANSACTION INCLUDING THE ACQUISITION OF 11 NEWBUILD LNG CARRIERS FOR $3.1 BILLION
Capital Product Partners L.P. announced that it has entered into an umbrella agreement (the “Umbrella Agreement”) with Capital Maritime ...
Tuesday, 14 November 23
COAL INDIA BEATS Q2 PROFIT VIEW ON HIGH POWER DEMAND AMID WEAK MONSOON - REUTERS
Coal India on Friday reported better-than-expected second-quarter profit, helped by high power demand and boosted production amid a weak monsoon.
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- Kideco Jaya Agung - Indonesia
- Electricity Generating Authority of Thailand
- Salva Resources Pvt Ltd - India
- SN Aboitiz Power Inc, Philippines
- Ministry of Finance - Indonesia
- Chamber of Mines of South Africa
- Toyota Tsusho Corporation, Japan
- Jindal Steel & Power Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Savvy Resources Ltd - HongKong
- Formosa Plastics Group - Taiwan
- Timah Investasi Mineral - Indoneisa
- Oldendorff Carriers - Singapore
- Interocean Group of Companies - India
- Intertek Mineral Services - Indonesia
- CNBM International Corporation - China
- Iligan Light & Power Inc, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Karbindo Abesyapradhi - Indoneisa
- Indika Energy - Indonesia
- Electricity Authority, New Zealand
- Makarim & Taira - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Bhushan Steel Limited - India
- Merrill Lynch Commodities Europe
- Globalindo Alam Lestari - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Borneo Indobara - Indonesia
- Commonwealth Bank - Australia
- San Jose City I Power Corp, Philippines
- Alfred C Toepfer International GmbH - Germany
- The Treasury - Australian Government
- Coastal Gujarat Power Limited - India
- Sojitz Corporation - Japan
- New Zealand Coal & Carbon
- Bayan Resources Tbk. - Indonesia
- Aboitiz Power Corporation - Philippines
- Leighton Contractors Pty Ltd - Australia
- Africa Commodities Group - South Africa
- Maharashtra Electricity Regulatory Commission - India
- Miang Besar Coal Terminal - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Siam City Cement PLC, Thailand
- Parry Sugars Refinery, India
- Carbofer General Trading SA - India
- Indonesian Coal Mining Association
- Central Electricity Authority - India
- Indo Tambangraya Megah - Indonesia
- Bukit Baiduri Energy - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Bharathi Cement Corporation - India
- Thiess Contractors Indonesia
- Bhoruka Overseas - Indonesia
- Ind-Barath Power Infra Limited - India
- McConnell Dowell - Australia
- Sinarmas Energy and Mining - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Karaikal Port Pvt Ltd - India
- Parliament of New Zealand
- CIMB Investment Bank - Malaysia
- Kobexindo Tractors - Indoneisa
- PTC India Limited - India
- Coalindo Energy - Indonesia
- Planning Commission, India
- Standard Chartered Bank - UAE
- Tamil Nadu electricity Board
- Renaissance Capital - South Africa
- Grasim Industreis Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Latin American Coal - Colombia
- Australian Coal Association
- Indian Oil Corporation Limited
- ASAPP Information Group - India
- Economic Council, Georgia
- VISA Power Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Georgia Ports Authority, United States
- White Energy Company Limited
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Medco Energi Mining Internasional
- Kapuas Tunggal Persada - Indonesia
- Bulk Trading Sa - Switzerland
- European Bulk Services B.V. - Netherlands
- Jorong Barutama Greston.PT - Indonesia
- Indian Energy Exchange, India
- Australian Commodity Traders Exchange
- Sical Logistics Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Goldman Sachs - Singapore
- LBH Netherlands Bv - Netherlands
- Independent Power Producers Association of India
- Eastern Coal Council - USA
- Metalloyd Limited - United Kingdom
- Altura Mining Limited, Indonesia
- IHS Mccloskey Coal Group - USA
- Energy Link Ltd, New Zealand
- Wood Mackenzie - Singapore
- Mercuria Energy - Indonesia
- The University of Queensland
- Krishnapatnam Port Company Ltd. - India
- Romanian Commodities Exchange
- SMG Consultants - Indonesia
- Singapore Mercantile Exchange
- Energy Development Corp, Philippines
- GAC Shipping (India) Pvt Ltd
- Marubeni Corporation - India
- Sakthi Sugars Limited - India
- IEA Clean Coal Centre - UK
- London Commodity Brokers - England
- Tata Chemicals Ltd - India
- Malabar Cements Ltd - India
- Essar Steel Hazira Ltd - India
- South Luzon Thermal Energy Corporation
- Global Green Power PLC Corporation, Philippines
- TeaM Sual Corporation - Philippines
- Posco Energy - South Korea
- Deloitte Consulting - India
- Samtan Co., Ltd - South Korea
- Pipit Mutiara Jaya. PT, Indonesia
- Thai Mozambique Logistica
- Ambuja Cements Ltd - India
- Trasteel International SA, Italy
- Power Finance Corporation Ltd., India
- PNOC Exploration Corporation - Philippines
- Xindia Steels Limited - India
- Binh Thuan Hamico - Vietnam
- PetroVietnam Power Coal Import and Supply Company
- Kalimantan Lumbung Energi - Indonesia
- International Coal Ventures Pvt Ltd - India
- Edison Trading Spa - Italy
- Coal and Oil Company - UAE
- Rashtriya Ispat Nigam Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Petron Corporation, Philippines
- Gujarat Sidhee Cement - India
- Wilmar Investment Holdings
- Aditya Birla Group - India
- Maheswari Brothers Coal Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Orica Mining Services - Indonesia
- Price Waterhouse Coopers - Russia
- Holcim Trading Pte Ltd - Singapore
- Asia Pacific Energy Resources Ventures Inc, Philippines
- ICICI Bank Limited - India
- Jaiprakash Power Ventures ltd
- Therma Luzon, Inc, Philippines
- Port Waratah Coal Services - Australia
- Chettinad Cement Corporation Ltd - India
- Madhucon Powers Ltd - India
- Global Coal Blending Company Limited - Australia
- Siam City Cement - Thailand
- Mercator Lines Limited - India
- Kartika Selabumi Mining - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Cement Manufacturers Association - India
- Meralco Power Generation, Philippines
- Simpson Spence & Young - Indonesia
- Bangladesh Power Developement Board
- Attock Cement Pakistan Limited
- Vijayanagar Sugar Pvt Ltd - India
- India Bulls Power Limited - India
- Sindya Power Generating Company Private Ltd
- Heidelberg Cement - Germany
- Riau Bara Harum - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Mjunction Services Limited - India
- Lanco Infratech Ltd - India
- GMR Energy Limited - India
- Anglo American - United Kingdom
- Sree Jayajothi Cements Limited - India
- Barasentosa Lestari - Indonesia
- Vedanta Resources Plc - India
- Vizag Seaport Private Limited - India
- Orica Australia Pty. Ltd.
- Agrawal Coal Company - India
- Mintek Dendrill Indonesia
- Directorate General of MIneral and Coal - Indonesia
- AsiaOL BioFuels Corp., Philippines
- GVK Power & Infra Limited - India
- Kaltim Prima Coal - Indonesia
- Straits Asia Resources Limited - Singapore
- Manunggal Multi Energi - Indonesia
- Central Java Power - Indonesia
- Semirara Mining Corp, Philippines
- Kumho Petrochemical, South Korea
- Cigading International Bulk Terminal - Indonesia
- Kepco SPC Power Corporation, Philippines
- Ministry of Mines - Canada
- Minerals Council of Australia
- Ceylon Electricity Board - Sri Lanka
- MS Steel International - UAE
- Bank of Tokyo Mitsubishi UFJ Ltd
- Ministry of Transport, Egypt
- Rio Tinto Coal - Australia
- Banpu Public Company Limited - Thailand
- Antam Resourcindo - Indonesia
- Star Paper Mills Limited - India
- Videocon Industries ltd - India
- Pendopo Energi Batubara - Indonesia
- Larsen & Toubro Limited - India
- Bhatia International Limited - India
- Baramulti Group, Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- The State Trading Corporation of India Ltd
- Eastern Energy - Thailand
- Sarangani Energy Corporation, Philippines
- Bukit Makmur.PT - Indonesia
- Directorate Of Revenue Intelligence - India
- Global Business Power Corporation, Philippines
- Dalmia Cement Bharat India
- Indogreen Group - Indonesia
- OPG Power Generation Pvt Ltd - India
- Uttam Galva Steels Limited - India
- PowerSource Philippines DevCo
- SMC Global Power, Philippines
- Meenaskhi Energy Private Limited - India
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