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How Over-invoicing of Imported Coal Has Increased Power Tariffs
Forty of India's biggest energy companies are being investigated by a wing of the Union Ministry of Finance for over-invoicing of imported coal. The artificially higher prices of coal have been passed on to electricity consumers across the country. The scam is conservatively estimated by government officials at no less than ₹29,000 crore, a third of which is in the form of higher power tariffs. Big names from the corporate sector, notably the Adani Group and Anil Dhirubhai Ambani Group, are being probed for their alleged involvement in the scandal. An exclusive report.
The authors would like to acknowledge Maya Palit for writing and research assistance.
On the last day of March, the Directorate of Revenue Intelligence (DRI), which comes under the Union Ministry of Finance, issued a “general alert” to 50-odd customs establishments all over India highlighting the modus operandi of over-invoicing of imports of coal from Indonesia. The DRI has claimed that money was being “siphoned” off outside the country and that electricity generating companies were availing of “higher tariff compensation based on (the) artificially inflated cost of the imported coal.”
The authors have learnt that for over a year and a half, the DRI has been probing this scandal relating to imports of coal by a host of well-known companies in the private as well as the public sectors, including companies owned by state governments.
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