Officials at the residence of L.K. Advani recently received a two-page note from a little-known body called the West Bengal Small Consumers Association (WBSCA). It plaintively sought the home minister's intervention to save the state's coal consumers from the stranglehold of the mafia, which it alleged was now controlled by the dreaded Dawood Ibrahim.
The note may have come as a shock to the minister's office, but those associated with Bengal's coal trade have known and dealt with mafia extortion for decades now. And their patience is wearing thin. The state supplies an estimated 600 rakes, or 13.5 lakh tonnes, of coal worth Rs 300 crore a month.
According to the note signed by WBSCA secretary Dilip Pal, D Company is believed to have engaged select operators and traders to take care of the coal business. "For instance, Suresh Singh and Brijesh Singh, both with antecedents leading (sic) to Dawood and accused in many murder cases and also having CBI cases against them in Dhanbad and Uttar Pradesh, have set up a plush office in Kolkata (Essem Marketing (P) Limited, located at 1, British India Street)...(and) are demanding sums varying from Rs 250,000 to Rs 300,000 per rake.... In the event of such happening (sic), coal sale from Eastern Coalfields Limited (ECL) is bound to drop, giving impetus to the black market that is also controlled by this mafia."
A senior official of the state-owned Coal India Ltd (CIL) said the matter was under investigation, with chief minister Buddhadeb Bhattacharya having held two rounds of meetings with DGP Dinesh Chandra Bajpeyi. "We've never had trouble like this and efforts are on to get to the bottom of the mafia network, especially Dawood's latest interest in the coal trade," CIL chief vigilance officer Sashi Prakash told Outlook.
Coal minister Ram Vilas Paswan raised the issue in a recent communique to the CMs of Jharkhand and Bihar, apart from discussing it with Bhattacharya. Ministry officials say Paswan had asked Bhattacharya to probe the Dawood angle also because the state has of late become a hub for mafiamen and terrorists with Pakistani and West Asian links, as clear from the January 22 attack on the American Centre in Calcutta.
How does the mafia operate? Ministry officials who have been talking to Bengal's top cops attribute the crisis to the lack of arms and proper policing of the different sidings of ECL, a CIL subsidiary. This, despite the situation on paper—ECL has a 5,500-strong security force aided by two 1,000-man cisf and West Bengal Police battalions. However, ECL's own force has a mere 600 guns.
Police officials admit to a knowledge of mafia operations, earlier confined to the coal belt of Bihar and eastern UP. They say that criminals with a Dawood connection find the extortion business relatively easy to operate in, posing as coal traders themselves. "On investigation, we have found the office operations very, very discreet. None of them have any knowledge of the coal business. It's just a front," says a senior official of West Bengal Police.
He also said both the Calcutta and state police have conclusive evidence on Dawood's men, as coal agents and traders, being posted at the pitheads of collieries run by various CIL subsidiaries (like ECL, Central Coalfields Ltd and Bharat Coking Coal Ltd). The security there has no way to evict the 'traders'. Once the coal is loaded on the wagons, they intervene and charge commission at absurdly high rates.
Compared to the standard commission for a single pit of Rs 10,000-Rs 15,000 per rake (a rake weighs 2,250 tonnes and costs Rs 50 lakh), the mafia demands Rs 2-3 lakh. To pay it, the traders must pass on the extra costs to the consumers, equally between industrial and non-industrial users, or get out of the business.The Bengal coal, from the mines of Asansol and Ranigunj, is of premium quality because of its high calorific value (read high heat-intensive) and in high demand among refractories, glass and ceramic factories.
Says a coal trader from Calcutta: "We are in a Catch 22 situation. We cannot charge the customers more, nor cancel rake movement which means complete drying up of supplies. And we are too scared to complain to the police." According to him, most of these operators are dreaded criminals, including those on the run from Bihar and Orissa. "Two traders who refused to pay were shot dead last month. And these people are very different, working with sophisticated weapons and satphones," he wailed.
Agrees Ranjan Arora, senior VP of the Calcutta-based Indian Coal Merchants Association: "If the police fail and extortion continues, we'll soon be out of business. But we are determined not to make any extortion payment and have already asked the Railways to allow us to make freight payments in Calcutta." This, Arora feels, will help combat the mafia since it usually kidnaps the coal trader carrying the demand draft for rail freight (in case the payment is not made). "And that creates a lot of problems because we end up paying something like Rs 4-5 lakh as (freight) surcharge to the Railways," says Arora.
Besides operating at the sidings, Dawood's men are also said to be taking over mining of abandoned pits, replacing the group of illegal Asansol and Ranigunj-based operators. As a result, a significant portion of the entire 1,500 sq km of the Ranigunj-Asansol coal belt is now under the control of Dawood's men posing as traders. There are 1,380 abandoned pits and inclines of ECL in the region. "They (Dawood's men) are organising the coal mafia. They are present everywhere, from hijacking consignments with false documents to pilferage to illegal mining. It's not a mere law and order problem because they have the support of a number of local politicians," says N. Chattopadhyay, ECL vigilance officer at Asansol.
State police say that around 2,000 tonnes of illegally mined coal is seized every month. To no avail, protests Haradhan Roy, former MP and now general secretary of the Colliery Majdoor Sabha of India (CMSI). "It's a shame! The seized coal is heaped outside police stations and the mafia comes back to collect it. Do you know ECL's coal production in this region is 37,579 tonnes a day and illegal mines produce almost the same (30,000 tonnes)?" he asks. "It's obvious that they want to make the best of this lucrative business. And they will be able to do it because none of the states have shown serious interest in combating the coal mafia," he adds.
Roy's fear is not without basis. The mafia operations have just multiplied the woes of the two lakh employees of ECL. The company is faced with closure, kept in abeyance only by Paswan who has suggested merger of all CIL subsidiaries, to protect the interests of his constituency. Even that may not be good news for Bengal, since the coal sector provides indirect employment to an additional three lakh people in the state.
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