Pvt firms can mine coal commercially

New Delhi, February 20

The government today launched its most ambitious big-bang reform in the coal sector by opening up commercial coal mining to private sector companies.

The approval for opening up of the mining sector came at a meeting of the Cabinet Committee on Economic Affairs chaired by Prime Minister Narendra Modi.

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The panel approved the methodology for the auction of coal mines and blocks for sale of coal under the Coal Mines (Special provisions) Act, 2015, and the Mines and Minerals (Development and Regulation) Act, 1957.

Besides ensuring transparency, it will also boost investment, create employment and enhance earnings and improve living conditions of labourers, according to an official statement.

The opening up of commercial coal mining for the private sector is the most ambitious coal sector reform since the nationalisation of this sector in 1973. 

The Supreme Court had on October 24, 2014, cancelled 204 coal mines/blocks allocated to various government and private companies since 1993 under the provisions of the Coal Mines (Nationalisation) Act, 1973.

The Coal Mines (Special Provisions) Bill, 2015, was passed by Parliament for ensuring transparency and accountability. Enabling provisions have been made for the allocation of coal mines by way of auction and allotment for the sale of coal.

The methodology gives highest priority to transparency, ease of doing business and ensures that natural resources are used for national development, officials said. — TNS

The move

• The Cabinet Committee on Economic Affairs has approved the auctioning of coal mines to any firm bidding the highest per tonne price
• At present, private sector firms are allowed to mine coal only for use in their cement, steel, power and aluminium plants
• Coal India Limited is the sole commercial miner with 80% market share at present