Published: Wed, February 21, 2018
Money | By Armando Alvarado

Cabinet decision ends Coal India monopoly

Cabinet decision ends Coal India monopoly

Such opening up of coal mining sector for unhindered exploitation by private and foreign corporate without any restriction on pricing and end-use will definitely pave the way for weakening and privatisation of public sector coal industry, both Coal India and Singareni Collieries Ltd, thereby affecting the coal production for both public and industrial consumption as a whole, it said.

Press Information Bureau tweeted the methodology for the auction of coal blocks/mines.

The government had already enabled some commercial mining earlier through the Coal Ordinance (Special Provisions), 2014. Opening up the sector will also lead to energy security through ass-ured coal supply, acco-untable allocation and affordability, he added. "India has more than 300 billion tonnes of coal and we should not be importing coal".

Though the government claimed this reform was expected to bring efficiency into the coal sector by moving from an era of monopoly to competition, AICWF General Secretary pointed out government's repressive policies on the state-owned coal companies.

On being asked whether companies would be allowed to sell coal overseas, Goyal told Reuters, "I have no problem (with exports), but nobody is going to take our 45 percent high ash coal".

The move comes as India seeks to cut down its reliance on imported coal amid power shortages caused by the lack of availability of the fuel.

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The committee gave its nod for railway projects worth Rs11,660 crore which included doubling of rail lines along with electrification and a new railway line in Bihar, Odisha, Uttar Pradesh and Madhya Pradesh.

It said that so long private sector was allowed to mine coal only for captive use in power, cement and steel industry and debarred from selling the coal in market.

Cabinet Committee on Economic Affairs (CCEA) approved methodology for the auction of coal mines/blocks for sale of coal under the Coal Mines (Special Provisions) Act, 2015 and the Mines and Minerals (Development and Regulation) Act, 1957, on Tuesday. It noted Delhi had also identified big coal blocks with 40 million tonnes to 50 million tonnes reserve for bidding. "The blocks will be awarded through a forward auction".

According to Minister Goyal, the measures "will enhance competition in the system, bring efficiency in coal production, reduce coal import, save foreign exchange, and generate job opportunities for the people".

Shares of Coal India gained 0.2% in Mumbai trading, while the benchmark S&P BSE Sensex closed 0.4% higher.

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