20 Jun, 2009
Indian government is planning to open up coal mining to private sectors without restriction of captive use and expected to invest Rs 118,000 crore for increasing production to 1,061 million tonnes a year by 2025. An estimated Rs 95,000 crore investment in opencast mining and Rs 23,000 crore in underground mining will be required to attain the 2025 production target.
A reform was reported earlier in 2007, that private companies should be allowed in coal mining and laid down steps to bring in competition — both in handing out of mines and pricing — besides a regulatory framework to check companies from profiteering through cartels or monopoly.
The roadmap said a competitve bidding system will keep out non-serious players and ensure optimal allocation of coal blocks. It says pricing of various grades of coal should be based on their calorific value (heat-producing capacity) and more sales through e-auction be encouraged to derive a market price.
The roadmap recommended pushing a pending legislation for making changes in the Coal Mines (Nationalisation) Act of 1973 that will help garner such huge investments through full-scale private investment. The Coal Mines (Nationalisation) Amendment Act, 2000, has been stuck over lack of consensus among policy makers over key issues, including allowing private players.
Source: Times of India