by IANS - Jun 14 2020, 8:45 am
In a big reform initiative aimed at attracting global investment in the mining sector, the government proposes to start auction of coal mines for commercial extraction by private sector from 18 June.
Prime Minister Narendra Modi will be the chief guest at the launching programme to be virtually held in New Delhi.
"We are launching first-ever commercial coal auctions in the country on 18th June. Event will be graced by PM @NarendraModi Ji. It is his vision & guidance to make #AtmaNirbharBharat in coal. I am proud that we are well on our way to achieve it," Union Minister of Coal & Mines Pralhad Joshi has tweeted.
The commercial coal mining auctions are completely different from the earlier regime of restricted sectors, use and price. Now there are no such restrictions at all.
The proposed auctions have terms and conditions which are very liberal, allowing new companies to participate in the bidding process, reduced upfront amount, adjustment of upfront amount against royalty, liberal efficiency parameters to encourage flexibility to operationalize the coal mines, transparent bidding process, 100% FDI through automatic route and reasonable financial terms and revenue sharing model based on National Coal Index.
The successful bidders will also have flexibility in coal production unlike past and have provision for incentives for early production and coal gasification.
The coal mines auction process will lay strong foundation for energy security in the country by producing additional coal, providing large-scale employment and huge opportunities for investment in the coal sector.
These efforts will supplement the 1 billion tonne coal production likely from Coal India in FY 23-24 and meet full requirement of domestic thermal coal.