India Opens Up Coal Mining – Free PDF Download

Table of Contents

Though India is the 4^thlargest resource in the world,
It imported 235 million tonnes of coal last year.
Of this, 135 million tonnes could have been substituted with domestic reserves.
The total cost of that is Rs 1.71 lakh crore.

Earlier, 100% FDI under the automatic route was allowed for coal mining for captive consumption by power projects, iron and steel and cement units.
Section 11A of the Mines and Minerals (Development and Regulation) Act provides that The central government can auction coal and lignite mining licences only to companies engaged in- Iron and steel, Power and Coal washing sectors.
The Cabinet has approved promulgation of Mineral Laws (Amendment) Ordinance 2020
It will amend- The Coal Mines (Special Provisions) Act, 2015,
The Mines and Minerals (Development and Regulation) Act, 1957. (iron ore mining lease will expire in March)

IMPACT OF THE ORDINANCE

It allows coal mining for any company present in sectors other than steel and power.
It dispenses away with the captive end-use criteria.
The end-use restriction had led to “comparatively less” participation in the coal block auctions.
Of 204 coal block allocations cancelled by the Supreme Court in 2014, only around 29 had been auctioned
Previously, there was a restriction that anybody, to participate, should have the coal mine operation in India.
This condition has now been removed.
Thus, companies that do not have coal mine operations in India to also participate in coal block auctions.