The Cabinet has approved an ordinance that will pave the way for the growth of the coal sector and allow foreign direct investment, Coal Minister Pralhad Joshi said. It allows sectors other than steel and power to mine coal and removes end-use restrictions. In 2019, India imported 235 million tonnes of coal, though 135 million tonnes was substitutable, Joshi added.
“We have taken a historic decision by promulgating amendment to the MMDR Act, 1957. These amendments will open up new areas to the growth in coal and mining,” Joshi said after a cabinet meeting where the decision was taken.
Pradhan said that “this a mother reform in the coal industry”. This will lead to the growth of segment, promote ease of doing business, besides “democratisation of the sector by opening the sector for anyone”, Joshi said. The decision will result in “promoting FDI in the sector by removing the restriction and eligibility criteria for the participation. It will boost foreign direct investment” he said.
According to Joshi, of the 334 non-captive mining leases expiring March 31, 46 are working mines. The ordinance will allow auction of 46 iron ore and other mines before March 31, 2020. Though the auction process of these mines have started but this amendment will strengthen the auction process.