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India’s transition from coal will be ‘messy & complicated, affect 2 crore people’, says study

Socio-Economic Impacts of Coal Transition in India report by National Foundation for India researchers comes days after India's commitment to phasedown of the resource at COP26.

Coal | Representational Image | Photo: Prashanth Vishwanathan | Bloomberg
Coal | Representational Image | Photo: Prashanth Vishwanathan | Bloomberg

New Delhi: India’s transition from coal to more renewable sources of energy will be “a messy and complicated exercise”, researchers at the National Foundation for India (NFI) have said, days after the country committed to a global phasedown of unabated coal power at the COP26 climate change conference in Glasgow.

The researchers, who released a report titled Socio-Economic Impacts of Coal Transition in India Monday, added that even “at a conservative estimate”, the process will affect over 1.3 crore people.

This figure “does not include those in the informal sector in coal mining, labour involved in coal imports (at the ports or transport from ports to thermal plants), indirect activities in the iron and steel sector including third party sellers, warehousing staff, iron ore mining etc, the dependents of workers or even third party vendors like equipment manufacturers”, the report added. If these numbers are added, the figure of those affected will be closer to two crore, it stated.

In a statement released Monday, Swati D’Souza, climate action lead at NFI, who led the study, said some job profiles like coal transport or coal handling at power and iron steel units are more vulnerable than others during a phaseout in these industries. “Even with retraining or reskilling, you cannot have a one-shoe-fits-all approach because as the study shows the socio-economic indicators and skill levels differ across job profiles and industries,” she said.

India committed to a net-zero emissions target by 2070, as well as a global phasedown of coal at the Glasgow conference, which ended on 13 November. India is the third largest emitter of greenhouse gases, after China and the US, and the second biggest producer of coal in the world.

The release of the NFI report was accompanied by a keynote address by Dr Anil Jain, secretary of the Ministry of Coal. “We need to identify the people whose lives and careers will be impacted when transition happens, such that there is some quantification and targeting. It will give relief to local people and bring unions on board. Hence, it is not just a number, but lives which are in focus for this international (Glasgow) agreement. This will help in quantifying the magnitude of the problem in many senses,” Jain said.

Also read: Why China and India aren’t the climate villains of COP26

Complications in coal transition

According to the researchers, 266 districts in the country have at least one asset linked to the coal sector, such as a coal mine, thermal power plant, sponge iron plant or steel plant. Of these, 135 districts have two or more assets dependent on coal.

The states that are most vulnerable to the impact of a coal phaseout include West Bengal, Jharkhand, Chhattisgarh, Odisha, and Madhya Pradesh, and parts of Uttar Pradesh, Telangana, Maharashtra, and Andhra Pradesh.

In order to successfully transition out of coal use, India would need to create a roadmap that “accounts for technical, social, and economic transition of coal districts and states, to put the people at the centre of its plan”, stated the report.

A transition out of coal will be complicated by three factors, the report added — the large proportion (about 70 per cent) of contract/informal labour involved in coal and coal-dependent sectors (such as power, iron and steel and brick manufacturing), a lack of information on their socio-economic backgrounds, and the national policies and growth plans for coal dependent sectors that don’t necessarily align with India’s commitment to phase down coal.

According to the report, understanding the socio-economic background of workers involved with coal and coal-dependent sectors “becomes necessary while designing policies on retraining and reskilling” labour to ensure a smooth transition.

Workers in the brick manufacturing sector, for example, run the risk of being excluded from a transition plan, “given the labour is employed for six months in a year, is migratory by nature and therefore there are no official records on the number of people employed in the sector or a platform for the labour to be a part of the discussion”, explained the report.

Lastly, policies around coal and coal-dependent sectors haven’t yet changed to align with the 2070 net-zero goal and phasedown of coal. The Indian railways, steel and iron industries, and the power sector are all heavily reliant on coal, and don’t yet have comprehensive plans to transition, the report pointed out.

“Environment remediation and decommissioning or closure plans have to become a necessary component for all sectors,” said the report, adding that the closures of coal power plants, steel plants and others dependent on coal will have to be monitored and implemented at the both the central and state levels.

Also read: If there’s one Gujarat model we must replicate, it’s the power sector reforms one

The way forward

According to the researchers, India’s definition of a worker impacted by coal transition should be included across different sectors, “with targeted emphasis on contract/informal labour and their socio-economic profile”. Excluding them could lead to a “significant chunk of the labour force” missing out on the benefits of the transition process.

District authorities will be a focal point for the transition roadmap, said the report, “since they are the key implementers and the first point of contact for local resistance or support”.

The roadmap must include the voices of trade unionists and community leaders, the report added, “since they will essentially be the communication bridge between the management, governments, and the larger labour force”.

India must communicate at a global level to ensure funding, since the scope of a just transition is unlikely to be met by domestic funds alone.

“Multilateral Development Banks will need to de-risk coal bearing areas during the transition period to facilitate green investments,” stated the report, referring to the process of making the transition cost effective for private investors.

It added that “domestically, the country will also need to prepare its financial system for early closures (of coal mines)”.

(Edited by Poulomi Banerjee)

Also read: Coal supply will improve but it’s time India transitions to options like natural gas for power