Lawstreet Journal

Government to Auction 41 Coal Blocks for Commercial Mining; Aims to Achieve Self Reliance

Lawstreet Journal 22 Jun 2020 7:58pm

Image courtesy: Lawstreet Journal Executive Government to Auction 41 Coal Blocks for Commercial Mining; Aims to Achieve Self Reliance

In its bid to promote the ‘Aatmanirbhar Bharat Program’, the Government of India has decided to offer 41 coal blocks in its first auction, to end the monopoly of Coal India and to curb dependence on other countries for its import. The program, launched by Prime Minister Narendra Modi on 18 June 2020, will be implemented under the aegis of the Ministry of Coal, under the provisions of Coal Mines (Special Provisions) Act and Mines and Minerals (Development and Regulation) Act.

Despite having the fourth-largest reserves of coal, India imports a significant amount of coal every year due to high dependence and lack of domestic availability. In the financial year ’20, India imported 251 million tons (MT) of coal worth Rs 1,58,685 crore. However, the government has planned to substitute 135MT of imports with the opening of the coal sector. The blocks are located across central mainland, in the states of Madhya Pradesh, Chhattisgarh, Jharkhand, Orissa, and Maharashtra.

The auction will be based on a revenue-sharing model, rather than on a ‘fixed rate per ton’ basis as was done earlier. In order to augment coal production, the upfront (advance) amount of payment and performance and bid security have also been reduced. Under commercial mining, no restrictions will be imposed on private companies regarding the sale of coal.

“This decision of the Modi government will create more than 2.8 lakh jobs, attract capital investment worth 33,000 crores and generate annual revenue of Rs 20,000 crore for the state governments,” Home Minister Amit Shah tweeted.… Continue Reading...

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