India will allow private and foreign companies to mine coal without any end-use or price restrictions as the government cleared new auction guidelines to boost supply of the fossil fuel that powers over three-quarters of the nation’s electricity plants.
The Cabinet Committee of Economic Affairs approved commercial coal mining for domestic and international companies “using new, safe and innovative technologies”, Minister of Railways and Coal Piyush Goyal said in a press conference in New Delhi today. “This will improve ease of doing business. All revenue generated from auctions will be given to states.”
That comes as India, the world’s largest importer of coal, is looking to boost its power output and domestic production has not kept pace with demand. Inbound shipments are expected to rise as sate-run Coal India Ltd., which produces more than 80 percent of India’s coal, has failed to meet targets, Bloomberg reported quoting Benjamin Sporton, chief executive at the World Coal Association.
The auction of mines will be conducted in a transparent process, Goyal said without listing out the number of mines available for bidding. “We are in the process of identifying mines for commercial mining.”
It will be a forward auction and people will be encouraged to come through the e-bidding platform, he said Goyal.