Commercial mining will make maximum coal available in market at earliest: Joshi

• He added that a transparent auction process for commercial mining will encourage transparent pricing of coal based on market forces

• While stressing that commercial mining of coal will only increase competition in the sector, the minister said that it won't impact state-run Coal India Limited

New Delhi: Commercial mining will make maximum coal available in the market at the earliest, said Union Coal Minister Pralhad Joshi while responding to a question in the Lok Sabha. In a written response, Joshi said, "Auction of coal mines for sale of coal would create a market place for coal with multiple producers to drive competition and adopt best practices in mining as well as environment management." He added that a transparent auction process for commercial mining will encourage transparent pricing of coal based on market forces.

"It would make maximum coal available in the market at the earliest. Auction of coal mines for sale of coal is expected to bring efficiency in the coal sector due to increased competition and deployment of best possible technology including by Coal India Limited (CIL) and its subsidiaries," said the Coal Minister. He added that availability of more coal would reduce India's import bill.

Coal India won't be affected by commercial mining: Joshi

While stressing that commercial mining of coal will only increase competition in the sector, the minister said that it won't impact state-run Coal India Limited (CIL). "Coal Blocks, whose allotments were canceled by Hon Supreme Court in year 2014 ( Blocks under CMSP Acts) and new blocks identified under MMDR Act and CBA Rules 2017 are proposed to be allocated for the commercial mining hence CIL is not to be affected," said Joshi.

Also read: 24 people have been killed in 6 industrial accidents at NLC since 2017: Pralhad Joshi

The backdrop

The auction process for commercial coal mining has already started. On the directions of the Central government, the nominated authority has started the auction of 38 coal mines for sale of coal under the provisions of the CMSP Act and the MMDR Act. 

The government had earlier reviewed the Foreign Direct Investment (FDI) policy in coal mining on September 18, 2019, making way for 100 percent FDI under automatic route for sale of coal, coal mining activities, including associated processing infrastructure, subject to the provisions of the CMSP Act and the MMDR Act as amended from time to time.

(PSU Watch– India's Business News centre that places the spotlight on PSUs, Bureaucracy, Defence and Public Policy is now on Telegram. Join PSU Watch Channel in your Telegram and stay updated)