The government has asked Coal India to focus on production enhancement, saying it cannot let the "profitability tumble" as the recent wage hike will have an estimated impact of nearly Rs 6,000 crore annually.

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"They (Coal India) have to increase their production and productivity. That goes without saying. When they came to meet me after they signed this (wage pact) both the employee leaders and management were sitting. I told them that you have to do that," Coal Secretary Susheel Kumar told PTI.

Coal India (CIL) had in October signed a wage agreement with workers' unions proposing 20 per cent hike in salaries for a period of five years, which will have an estimated impact of Rs 5,667 crore per year to the world's largest coal miner.

"Because if there is Rs 5,000-Rs 6,000 crore of outgo that has to be generated. We cannot let the stock prices tumble. We cannot let the profitability tumble. So, they (CIL) have to work for productivity and production enhancement," Kumar said.

The public sector firm had signed the agreement at 20 per cent hike in salaries against workers' demand for a 50 per cent raise.

"I think they (CIL) have discussed something about productivity also with employees. So obviously, I would feel that this much money can be generated," the secretary stressed.

When asked whether the PSU go for price hike to offset the impact, he said: "Price rise is an issue on which government does not intervene....It is for the board (to take a call on it".

In 2017-18, CIL has been pegged production target at 600 million tonnes (MT) with an annualised growth of about 8.3 per cent over the last year. In 2018-19, the envisaged coal production projection is 773.70 MT with a growth of about 28.95 per cent. The miner is eyeing an output of one billion tonnes by 2019-20. PTI SID