New Delhi: The Union Cabinet opened up auction of the coal mines to all sectors and allowed auction of 46 iron ore and other mines whose licences are ending in March.
It approved promulgation of the Mineral Laws (Amendment) Ordinance to amend the Mines and Minerals (Development & Regulation) Acgt 1957 and Coal Mines (Special Provisions) Act 2015. Shares of Coal India, a public sector company, have been falling since 2016 after the government relaxed rules for the private mining.
The Ordinance allows coal mining by any company present in sectors other than steel and power that alone were so far allowed captive mines. It dispenses away with the captive end-use criteria.
Coal Minister Pralhad Joshi told reporters after the Cabinet meeting that the CMSP Act will allow bidders that do not have plans to consume the coal also to bid for the coal mines. He said this will help curb imports of coal to plug the Rs 1.75 lakh crore loss to the exchequer. He also claimed that the move will also help India gain access to high-end technology for underground mining used by the global miners, besides speeding up the process of implementation of projects, ease of doing business and simplification of procedures.
Despite having the world's fourth largest coal reserve, India imported 235 million tonne of coal last year while 135 million tonnes valued at Rs 171,000 crore could have been met from domestic reserves, the minister said. He said the Ordinance would do away with the requirement of previous approval of cases where allocation of block was made by the Centre.
Joshi said the amendment to the MMDR Act will allow seamless transfer of environment and forest clearance in the operational mines. Oil minister Dharmendra Pradhan added that the amendment in the MMDR Act was necessitated to build confidence among the bidders to participate in the auction of 46 operational iron ore mines whose leases are expiring in March, 2020.
In reply to a question, Prdhan said the government was taking all necessary steps on oil issue due to tension in the Gulf. "We are in touch with all oil producing countries to deal with the situation arising out of escalated tension in the Gulf," he said.