Commercial mining of coal allowed to end government monopoly: Nirmala Sitharaman
Commercial mining of coal will be allowed to end government monopoly in the sector, Finance Minister Nirmala Sitharaman said in the fourth set of announcements on a Rs 20 lakh crore stimulus.
“Coal is a government monopoly. That government monopoly is being removed,” Ms. Sitharaman said.
In the coal sector, she said the government will allow commercial mining and nearly 50 blocks to be offered immediately. There will be no eligibility conditions and anybody can bid. However, there will be only upfront payment with a ceiling.
Major reforms in coal sector include:
1.Government monopoly in coal mining being removed. Private players to be allowed
2. This will be done based on a revenue-sharing mechanism instead of a regime of fixed rupee per tonne
3. Any party can bid for a coal block and sell it in the open market. Entry norms to be liberalized
4. Nearly 50 blocks to be offered; no eligibility conditions; only upfront payment with a ceiling
5. Coal bed methane will also be auctioned.
6. Rs 50,000 crore allotted for creating evacuation infrastructure for coal.
Also, a joint auction of bauxite and coal blocks would be done to enhance the aluminum industry’s competitiveness. This will help the aluminum industry reduce electricity costs.
She said the distinction between captive and non-captive mines will be removed to allow the transfer of mining leases and the sale of surplus unused minerals, leading to better efficiency and production.