Essar gets clearance for India coal block London-listed Essar Energy has received a long-awaited environmental clearance for its coal block in central India, which will allow it to provide fuel to its Mahan power plant. Analysts said the Ministry of Environment and Forests clearance, while positive, was only the first step towards fully supplying the 1,200mw power plant, in the central state of Madhya Pradesh. The block was first allocated to Mahan Coal Ltd, a joint venture between Essar Energy and Hindalco, in 2006. IN Energy India's approvals process was cumbersome and complicated, said Dipesh Dipu, partner at Jenissi Consulting, an energy consultancy in Hyderabad. "The requirements for final approval are not objective in nature so even though they got the first stage there is some degree of uncertainty in regards to the timeframe [for] when the final approval might come," he said. Lucas Herrmann, of Deutsche Bank, said that it would be years before the coal block would have a significant impact on Essar's sourcing challenges. "Although political risks around the remaining approval process now seem limited, there are still some risks around the remaining approval process, with legal challenges or regulatory delays possible," Mr Herrmann wrote in a note to investors. Essar heralded the news as an important step towards providing "much-needed" electricity to the people of India, 400m of whom go without power on an average day. "This is a major step forward in our strategy of providing full fuel security for all of our power generation assets, thereby eliminating price and delivery risks," said Naresh Nayyar, chief executive of Essar Energy. Shares in Essar Energy were up 4 per cent by midday trading in London. India's privately-held Essar Group owns 77 per cent of the company.