Chamalang coal city starts production

July 09 - 15, 2007

Supply of coal from Chamalang mines has started, The area around the coal mine is emerging as a new township in Balochistan. The Chamalang-Mekhtar track has also been made operational for heavy traffic enabling coal trucks to go to other areas. The tribal rivalry in the area during the last three decades had obstructed the mining of coal in Chamalang. The mines were made operational following the tripartite agreement between the Marri and Luni tribes and mine contractors last year on December 12.

Discovered some 35 years back, the 60km-long Chamalang coal mines could not be exploited due to security reasons. The Luni and Marri tribes had been at war over the ownership of the mines during the last three decades. This tribal rivalry had not only hampered mining activities in the area but also caused human casualties. Resultantly, the coal reserves remain untapped. As result of peace moves on both sides under official patronage, the two tribes entered into an agreement to revive the mining operations in the area.

Officials claim that the project would provide employment to 40,000 people whereas according to a rough estimate the profit from the supply of coal would be worth Rs30 billion per annum. The priority would be given to the establishment of schools, hospitals, better communication system, and the facility of standard hotels for visitors to the area.

The project would not only change the livelihood of the people of Kohlu, Loralai and Barkhan but also play a vital role in the economic progress of Balochistan. The main advantage of the project is that education facility would be provided to 300 students by the army and the package includes free education, books, uniforms, stationery and a Rs500-monthly stipend. The army in the initial stage would bear the cost however, later it would be managed through the Chamalang development fund.

The establishment of Chamalang development fund in fact reveals the social welfare aspect of the project. The development of natural and human resources is inseparably linked; hence the social and economic development must go together. Several mining projects are currently underway in Balochistan for exploring copper, lead and zinc as well as oil and gas.

Following the example of Chamalang fund, some others fund may also be established in other areas of the province where other projects are underway for the socio-economic uplift of the local people. Saindak fund and Reko Diq fund in Chagai, Duddar fund in Lasbella and Dilband fund in Mastung may also be set up in the province. Such initiatives will ensure that fruits of development are available to the local people at their doorsteps.

The Chamalang agreement also indicates that security situation in Balochistan can only improve when the real stakeholders feel a sense of ownership and they are held directly responsible for the security of the development projects. The nationalist parties criticize the federal government for ignoring the people and the Baloch leadership and not taking them into confidence while it signed accords with various international firms.

The nationalists say that the Reko Dik mineral project and the Gwadar port project are of great importance for Balochistan after Sui gas and Saindak projects but the government has long been ignoring the people of the province and their leadership in this regard. They have demanded that all agreements signed by the federal government with international firms for exploitation of mineral and other resources of the province be presented in the Senate and the Balochistan Assembly. The development amid political instability will not be sustainable. Government may invite and consult politicians and all the tribal notables of the province to solve the current crisis.

Preliminary work done by the government of Pakistan indicates existence of great potentials as the quality of coal is better than the rest of Balochistan. The coal ranges from high volatile C bituminous to high Volatile A bituminous with a total resource of six million tons. The government has decided to increase the share of coal in the country's energy mix from 7.6 percent to 18 percent by the year 2018. There are huge unexploited coal reserves in Balochistan.

In view of the rapidly mounting Pakistan's energy deficit, there is a high need to turn the province's coal-mining sector into a modern mechanised industry. The estimated reserves of all coal fields in the province are 196m tonnes. Presently about 1.5m tones of coal is being mined from the coal fields of Balochistan. Coal is the cheapest source of thermal energy used in industrial sector. There is no such facility of washing plant, that's why cement industry is bound to import coal. The investments can be made for establishing coal-washing plants.

According to a news report, Pakistan's mining sector has demanded of Central Board of Revenue to amend income tax rules and allow 100 percent write-off on expenditure incurred on its operations. other tax incentives the mining sector has demanded, include the permission for duty-free import of mining machinery, equipment, and transportation trucks, withdrawal of GST on coal for at least another five years, bank loans at three percent interest rate and the removal of the condition that the depletion allowance should not exceed 50 percent of the total amount invested.. These tax incentives, if granted, can help stimulate utilization of the country's vast coal reserves for energy generation.

The resumption of Chamalang mines carries several lessons about resolution of conflict in local perspective. The operationalization of Chamalang mines sets a good example in resolving disputes through political reconciliation. If serious and sincere efforts are made, politics is practiced according to the social environment and the tribal chiefs and elders are assigned a peacekeeping task, there will remain no room left for the conflict to arise in Balochistan. A conciliatory approach needs to be applied while dealing with the prevailing situation in the province. Government must try to resolve the security problem amicably through a peace truce with the tribal jirga and stop military operation in the province.

Syed Fazl-e-Haider,, is a Quetta-based development analyst in Pakistan. He is the author of six books, including The Economic Development of Balochistan, published in May 2004.