In a significant development, Coal India Ltd (CIL) has issued a tender inviting private service providers to manage its e-auction process for subsidiaries over the next two years. The move comes despite CIL transitioning to its internal e-auction platform earlier this year, developed by its subsidiary CMPDI in collaboration with the National Informatics Centre (NIC).
Industry Reactions and Concerns
The tender has raised eyebrows among long-standing external service providers, such as MSTC and mjunction, who have facilitated CIL’s e-auctions for nearly two decades. These firms are now seeking clarity on the scope of work before deciding on their participation in the tender process.
“We’ve sought greater clarity on the expected business in the tender, as our revenue depends on the number of auctions we conduct,” a senior official from a major service provider said.
The deadline for bid submissions has been set for November 27, with the new contracts expected to begin in April 2025, following the expiration of current agreements in March 2025.
Challenges with the Internal Platform
CIL launched its internal e-auction platform in January 2024 after successful trials in 2023. However, users have reported performance issues, prompting CIL to explore external service providers as an additional measure to improve operational efficiency.
“Engaging service providers to conduct e-auctions is aimed at having more options at hand. CIL should be in a position to respond to changing market and consumer requirements,” a senior official explained.
Balancing Internal and External Platforms
Despite the new tender, CIL has confirmed that its internal e-auction platform will continue to operate. This dual approach aims to enhance flexibility and ensure uninterrupted coal sales.
“We want to engage more firms to conduct coal auctions alongside our own platform to ensure smooth sales. The CMPDI platform will also continue to function,” a CIL official added.
Speculation Over Future Roles
The industry remains uncertain about the extent to which external providers will be utilized, with some speculating they may serve as a backup to the internal system. For external firms, the lack of clarity on assured revenue models and the volume of auctions remains a concern.
CIL’s coal volume through the e-auction platform is estimated to have reached around 60 million tonnes by September 2024, highlighting the critical role of these auctions in meeting market demand.
