CIL unions seek steep pay hike

„Workers ask for 50% raise in early talks

Trade unions at Coal India Ltd, the world's largest miner of the fuel, have demanded a 50 per cent increase in workers' wages, potentially pushing up costs of the fuel that helps produce more than twothirds of India's electricity.

The demand is backed by expectations for rising profits in coming years amidst a reduction in staffing and plans to increase production, said D.D. Ramanandan, secretary at the Centre of Indian Trade Unions, one of the associations active in Coal India. The unions had their first meeting with management last month to discuss the matter and more meetings will be held before they reach a decision, he said in a phone interview.

A 50 per cent wage boost would be a dramatic increase for Coal India, which revises salaries of non-executive staff every five years. Previous negotiations have typically led to 20 to 25 per cent increases. Coal India declined to comment on the demand, saying the talks are still at a nascent stage and it's looking for a "win-win situation for both sides."

The unions' position may be a bargaining tactic. But any hefty wage increase would resonate across India's energy sector and its broader economy. To offset the impending rise in expenses, the state-run miner is considering increasing prices of coal it sells in long-term contracts, which will drive costs through an economy already battling high inflation.

Soaring international prices of the fuel give Coal India greater room to increase its own prices. But costlier coal could spur the nation's clean energy transition by prompting some consumers to look for cheaper, cleaner options. India, the third-biggest emitter of greenhouse gases, is under pressure to adopt more ambitious climate action.

It's now cheaper to build utility-scale solar capacity in India than to run most of its existing coal and gas power stations, according to BloombergNEF. An increase in coal prices will tilt the balance further in favour of clean energy.

"We have good reasons to ask for a 50 per cent increase," said Ramanandan. "Coal India's production is rising and the employee numbers are reducing every year, which means more profits for the company. There should be no problem with workers getting a small share of that profit."

But Nathulal Pandey, president of the HMS-affiliated Hind Khadan Mazdoor Federation, told PTI that he had a meeting with the Coal India chairman on Wednesday during which the issue of workers' wages came up. "The chairman told me that it is difficult to give 50 per cent hike in workers' wages as the company is facing financial constraints. Even if the company gives a hike of let's say 10 per cent, it will result in financial burden of around Rs 5,000 crore to the PSU," Pandey said.

The Kolkata-based miner is among the largest corporate employers in the country, with around 256,000 workers on its rolls as of July 1. The company expects that number to drop 5 per cent annually for the next five-to-10 years as workers retire. The company spent Rs 38,700 crore

($5.2 billion) on employees in the last fiscal year, about

43 per cent of its revenue. The company has set a target to produce one billion tonne of coal by the year ending March 2024, a

68 per cent jump year-onyear.