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Thursday, 05 April 12
COAL EXPORT TAX: MATTER OF CONCERN FOR INDIA - SUNIL K KUMBHAT
 COALspot.com - Since the issuance of Indonesian Mining law in 2009, miners have increased their activities in exploring , exploiting and exporting all types of minerals,specially Black Gold –Coal.
In order to regulate the mining sector , the Goverment of Indonesia has announced a series of new mining regulations, including a ban on exports of some unprocessed metals and low-grade Coal from 2014 , which is designed to spur investment in mineral processing .The proposed ban on exports of coal under the 5,700-kcal/kg from Jan 2014 will change the dynamics of the global thermal coal market, which has seen spiralling demand from China and India. Such a ban will have a substantial impact on the thermal coal market, as large amounts of low-quality coal from Indonesia are exported to India and China.
Another Goverment regulation known as GR 24 of 2012 ( Amendment of GR 23 of 2010 ), signed by President of Indonesia on Feb. 21,2012 stipulates that foreign shareholders/ Companies must gradually divest 51 percent of their shares in local mining companies to local investors after the fifth year of commercial production and complete the divestment by the 10th year of production. The divestment regulation resulted from a revision to a earlier GR 23 of 2010 that required foreign shareholders in local mineral and coal mining companies to divest 20 percent of their holdings.
In a latest move The Goverment of Indonesia now plans to impose a tax of 25% on export of coal and base metals during the current year, and increase it to 50% in 2013. The step is to boost investment in the downstream industry of metal and mining sectors. It is also expected to restrict the exports of mineral and ore metal shipment.The date of implementing the regulation and calculating the Export tax is yet to announced.
Indonesian Government is capitalizing on the mining boom driven by high demand of thermal Coal from China and India . Inspite of series of Taxes , the proposed Export tax is designed to restrict the production and also share profit on the minerals being mined. Coal prices are increasing due to huge requirement and inadequate global production capacity. Govt of Indonesia is encashing the Global situation of demand and supply .Coal will remain hot commodity and Indonesia as heart of Coal Boom.
If the proposed tax is implemented , it is definitely cause of serious concern , particularly for Indian buyers. India is a major buyer of Indonesian thermal coal, along with are China, South Korea, Japan .This is a wake-up call for all the foreign miners operating in Indonesia specially for Coal, that gone are the days of soft and flexible regulations.It is also wake up call for country like India that slow environmental ,forestery clearances and land acquisition issues ,if not sorted out will led to stagnating coal production in India which will resultinto increased dependence on imports, specially from Indnonesia , Australia and south Africa.
Never before India has such a high demand for coal, so also environmental consciousness been so high. Both are legitimate & serious issues but the solution is not to clamp down on coal production. India’s soaring energy need is vital for its industrial growth.
The magnitude of growth in power generation in India will necessarily mean that coal demand will remain very strong. Coal will remain life line for Indian economy for coming many decades till identifying an alternative source that can match coal in its accessibility, availability and affordability in the context of scale of capacity addition required in India.
As the situation stands today, India could become the world’s biggest thermal coal importer by 2015 and Indonesia would be one of the Countries to take care of bulk of coal requirement.
India is today one of the fastest growing economies and also has a shortage of power supply. Indonesia is one of the countries with huge natural resources and exporting thermal coal to many countries for use in power plants for generating energy but it is paradoxical that Indonesia is short of energy. Many Indian companies are capable of sharing power technology and setting up mega power plants in Indonesia
Indonesian private companies can buy equity stakes in India’s power plants in exchange for long-term coal supply. Since India is today one of the fastest growing economies and also has a shortage of power supply then such deals can be beneficial to both parties.
Indonesia requires huge investment from foreign investors in infrastructure, Power Generation, Oil & Gas exploration, telecom sector, Port and Rapid transport system. So it is essential to have transparency in all regulations, legal system and improvement in corporate Governance. Indonesia's mining industry is undergoing a regulatory overhaul which may weaken the operating health and financial performance of many domestic mining companies.
Besides increased operating uncertainty, the new regulations of recent past & proposed may also make the mining industry less attractive to foreign investors. Foreign investor is likly to seriouly question the Safety and Security of their investment in mining sector considering the regulations of the recent past. Lack of transparency in the legal process and the risk of regulatory duplication and inconsistencies will continue to act as deterrents to substantial investment ,specially foreign direct investments (FDI).
As the situation stands today next couple of years shall be very challening for foreign companies operating in Mining sector in Indonesia.
The present proposed tax would hit the profits of both domestic and foreign-owned companies and would heavily raise costs for importers.
The market analysts and experts in mining sector are skeptical about all the mining regulations and plans announced in recent past.
By: Sunil K Kumbhat , Jodhpur (Rajasthan) India
Views expressed herein are personal views of the author and not that of COALspot.com.
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Monday, 26 March 12
WEEKLY DRY MARKET OVERVIEW - MARIA BERTZELETOU, HELLENIC SHIPPING
The Baltic Dry Index follows its upward incline for fourth consecutive week by rising to more than 900 points, up by 37% from the bottom low in the ...
Monday, 26 March 12
GOLDEN MINES FY11 REVENUE JUMPS 209% - INSIDER STORIES
Insider Stories reported that, coal miner PT Golden Energy Mines Tbk (GEMS), that is controlled by Sinar Mas Group, recorded a 209% jump in revenue ...
Saturday, 24 March 12
AUSTRALIA'S MINERAL TAX : BENCHMARK FOR OTHER COUNTRIES - SUNIL K KUMBHAT
COALspot.com - Natural resources rich counties like Australia , Indonesia , South Africa , Brazil etc are going through a spectacular resources boom ...
Saturday, 24 March 12
THE AVERAGE CHARTER RATES WAS AT CAPESIZE $ 4,546 PER DAY VS SUPRAMAX / $ 10,819 PER DAY - VISTAAR
COALspot.com - The BDI crossed 900 points this week closing at 908 points up by 3.89 pct. All other sectors were up except for cape index whic ...
Thursday, 22 March 12
ECI-CHINA HANDY RATES ARE AROUND US$ 8000 - FEARNLEYS
Handy
Another positive trend was seen last week with more cargoes entering the market. Skaw-Passero/US Gulf climbed slowly up to USD 3700, while US ...
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- Orica Mining Services - Indonesia
- GMR Energy Limited - India
- Indo Tambangraya Megah - Indonesia
- Thiess Contractors Indonesia
- Vizag Seaport Private Limited - India
- Sree Jayajothi Cements Limited - India
- Lanco Infratech Ltd - India
- Bayan Resources Tbk. - Indonesia
- Sical Logistics Limited - India
- Chamber of Mines of South Africa
- Cigading International Bulk Terminal - Indonesia
- Iligan Light & Power Inc, Philippines
- Straits Asia Resources Limited - Singapore
- AsiaOL BioFuels Corp., Philippines
- Agrawal Coal Company - India
- Ministry of Mines - Canada
- Eastern Coal Council - USA
- Petrochimia International Co. Ltd.- Taiwan
- Gujarat Electricity Regulatory Commission - India
- New Zealand Coal & Carbon
- PowerSource Philippines DevCo
- Ministry of Finance - Indonesia
- Mercuria Energy - Indonesia
- Indonesian Coal Mining Association
- Commonwealth Bank - Australia
- PTC India Limited - India
- Sindya Power Generating Company Private Ltd
- Wood Mackenzie - Singapore
- Pendopo Energi Batubara - Indonesia
- Merrill Lynch Commodities Europe
- Kohat Cement Company Ltd. - Pakistan
- Central Java Power - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Ministry of Transport, Egypt
- Australian Coal Association
- Kapuas Tunggal Persada - Indonesia
- Ambuja Cements Ltd - India
- Jindal Steel & Power Ltd - India
- Thai Mozambique Logistica
- Bhoruka Overseas - Indonesia
- IHS Mccloskey Coal Group - USA
- Siam City Cement - Thailand
- Goldman Sachs - Singapore
- Jorong Barutama Greston.PT - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Tata Chemicals Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Kideco Jaya Agung - Indonesia
- Economic Council, Georgia
- Leighton Contractors Pty Ltd - Australia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- GVK Power & Infra Limited - India
- London Commodity Brokers - England
- Anglo American - United Kingdom
- Karbindo Abesyapradhi - Indoneisa
- Romanian Commodities Exchange
- Port Waratah Coal Services - Australia
- Mjunction Services Limited - India
- Sakthi Sugars Limited - India
- Energy Link Ltd, New Zealand
- Kartika Selabumi Mining - Indonesia
- Savvy Resources Ltd - HongKong
- GAC Shipping (India) Pvt Ltd
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Power Finance Corporation Ltd., India
- Global Coal Blending Company Limited - Australia
- Vedanta Resources Plc - India
- ICICI Bank Limited - India
- Jaiprakash Power Ventures ltd
- Eastern Energy - Thailand
- Mintek Dendrill Indonesia
- Miang Besar Coal Terminal - Indonesia
- Kumho Petrochemical, South Korea
- Gujarat Mineral Development Corp Ltd - India
- Karaikal Port Pvt Ltd - India
- Madhucon Powers Ltd - India
- Deloitte Consulting - India
- ASAPP Information Group - India
- Larsen & Toubro Limited - India
- Carbofer General Trading SA - India
- Asmin Koalindo Tuhup - Indonesia
- Banpu Public Company Limited - Thailand
- Intertek Mineral Services - Indonesia
- Latin American Coal - Colombia
- Semirara Mining Corp, Philippines
- Orica Australia Pty. Ltd.
- Dalmia Cement Bharat India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Edison Trading Spa - Italy
- Manunggal Multi Energi - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Global Green Power PLC Corporation, Philippines
- TeaM Sual Corporation - Philippines
- Africa Commodities Group - South Africa
- Billiton Holdings Pty Ltd - Australia
- SMG Consultants - Indonesia
- The University of Queensland
- Interocean Group of Companies - India
- Barasentosa Lestari - Indonesia
- CIMB Investment Bank - Malaysia
- Altura Mining Limited, Indonesia
- Therma Luzon, Inc, Philippines
- Standard Chartered Bank - UAE
- Kaltim Prima Coal - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Samtan Co., Ltd - South Korea
- Independent Power Producers Association of India
- Semirara Mining and Power Corporation, Philippines
- Videocon Industries ltd - India
- Star Paper Mills Limited - India
- Directorate General of MIneral and Coal - Indonesia
- VISA Power Limited - India
- Formosa Plastics Group - Taiwan
- Siam City Cement PLC, Thailand
- India Bulls Power Limited - India
- Global Business Power Corporation, Philippines
- Alfred C Toepfer International GmbH - Germany
- Sarangani Energy Corporation, Philippines
- Trasteel International SA, Italy
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Coal and Oil Company - UAE
- White Energy Company Limited
- Minerals Council of Australia
- Rashtriya Ispat Nigam Limited - India
- Borneo Indobara - Indonesia
- Coalindo Energy - Indonesia
- Wilmar Investment Holdings
- Posco Energy - South Korea
- Xindia Steels Limited - India
- Bharathi Cement Corporation - India
- Planning Commission, India
- Rio Tinto Coal - Australia
- Indian Energy Exchange, India
- Krishnapatnam Port Company Ltd. - India
- Attock Cement Pakistan Limited
- Kepco SPC Power Corporation, Philippines
- Price Waterhouse Coopers - Russia
- Timah Investasi Mineral - Indoneisa
- Kobexindo Tractors - Indoneisa
- Antam Resourcindo - Indonesia
- Riau Bara Harum - Indonesia
- Ind-Barath Power Infra Limited - India
- Heidelberg Cement - Germany
- Vijayanagar Sugar Pvt Ltd - India
- Chettinad Cement Corporation Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Medco Energi Mining Internasional
- Makarim & Taira - Indonesia
- Malabar Cements Ltd - India
- Electricity Authority, New Zealand
- Coastal Gujarat Power Limited - India
- Directorate Of Revenue Intelligence - India
- Tamil Nadu electricity Board
- Bukit Asam (Persero) Tbk - Indonesia
- LBH Netherlands Bv - Netherlands
- Petron Corporation, Philippines
- Georgia Ports Authority, United States
- Uttam Galva Steels Limited - India
- Binh Thuan Hamico - Vietnam
- San Jose City I Power Corp, Philippines
- Simpson Spence & Young - Indonesia
- Bulk Trading Sa - Switzerland
- Meralco Power Generation, Philippines
- GN Power Mariveles Coal Plant, Philippines
- OPG Power Generation Pvt Ltd - India
- Gujarat Sidhee Cement - India
- Bukit Baiduri Energy - Indonesia
- Metalloyd Limited - United Kingdom
- Central Electricity Authority - India
- Pipit Mutiara Jaya. PT, Indonesia
- Oldendorff Carriers - Singapore
- Baramulti Group, Indonesia
- Australian Commodity Traders Exchange
- MS Steel International - UAE
- Essar Steel Hazira Ltd - India
- Cement Manufacturers Association - India
- Bangladesh Power Developement Board
- Mercator Lines Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Ceylon Electricity Board - Sri Lanka
- Bukit Makmur.PT - Indonesia
- Globalindo Alam Lestari - Indonesia
- Renaissance Capital - South Africa
- SN Aboitiz Power Inc, Philippines
- Maheswari Brothers Coal Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- The State Trading Corporation of India Ltd
- South Luzon Thermal Energy Corporation
- Electricity Generating Authority of Thailand
- International Coal Ventures Pvt Ltd - India
- Parry Sugars Refinery, India
- Parliament of New Zealand
- Marubeni Corporation - India
- Meenaskhi Energy Private Limited - India
- Salva Resources Pvt Ltd - India
- Aboitiz Power Corporation - Philippines
- The Treasury - Australian Government
- Energy Development Corp, Philippines
- PNOC Exploration Corporation - Philippines
- Indika Energy - Indonesia
- European Bulk Services B.V. - Netherlands
- Indogreen Group - Indonesia
- Indian Oil Corporation Limited
- Bank of Tokyo Mitsubishi UFJ Ltd
- CNBM International Corporation - China
- Sojitz Corporation - Japan
- McConnell Dowell - Australia
- Bhushan Steel Limited - India
- IEA Clean Coal Centre - UK
- Bhatia International Limited - India
- Singapore Mercantile Exchange
- Grasim Industreis Ltd - India
- SMC Global Power, Philippines
- Aditya Birla Group - India
- Toyota Tsusho Corporation, Japan
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