Welcoming the SC verdict scrapping coal block allocations, saying that the move would usher in much-needed transparency into the sector, ratings agency India Ratings has cautioned that the government will have to take immediate steps to ensure fuel linkage to operational end-use projects. "The judgement would bring in the much-needed transparency in the sector, which has been marred with non-transparent ad-hoc allocations. The government will have to play a pivotal role in the resolution of coal supplies linked to operational end use projects (EUP)," the credit rating agency said. According to India Ratings, mine allottees with non-operational captive coal blocks (CCBs) will face the risk of investments towards mine development as well as end-use projects being written down. "Once the CCB auction begins, there remains limited possibility for the same mine to be re-allocated to the respective developer."
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