Trade lobby proposes regulatory body for coal mining

The Indonesian Chamber of Commerce and Industry (Kadin) has called on the government to set up a regulatory body to supervise and manage the country's coal mining activities, Neraca daily reported on Saturday.

Herman Afif Kusumo, the head of Kadin’s commission for the development of energy resources, said in Jakarta on Friday that with such a regulatory body, the coal supply to the country's major users such as electricity power plants can be ensured.

"The regulatory body can also establish the long-term plan for the development of the country's coal mining sector," Herman said, adding that with such a effective plan the shortage of coal supply to main buyers such as PLN could be avoided.

When the coal price in the international market is on the rise, most coal producers allocate most of their production for exports, causing a shortage of supply at the domestic market.

"In such a situation, the regulatory body should be able to limit the export. This is important to avoid the shortage of supply at home," he said.

Besides regulating the national coal stock, the government, through the regulatory body, would be able to create a more conducive climate for coal mining investment. "Problem related to the royalty payment could be also handled more efficiently," he added. (*)