New Delhi: The government on Tuesday approved opening up of coal mining to the private sector for commercial use, a major reform in the sector since its nationalisation in 1973.
Announcing the decision taken by the CCEA, Coal and Railways Minister Piyush Goyal said the reform is expected to bring efficiency in the coal sector by moving from an era of monopoly to competition.
"It will increase competitiveness and allow the best possible technology into the sector. The higher investment will create direct and indirect employment in coal bearing areas, especially in the mining sector and will have an impact on economic development of these regions," he said.
While coal mines were till now auctioned for captive power generation, they will now be sold in an e-auction to private domestic and global miners.
The Cabinet Committee on Economic Affairs (CCEA), chaired by Prime Minister Narendra Modi, Goyal said has approved the methodology for auction of coal mines / blocks for sale of coal under the Coal Mines (Special Provisions) Act, 2015 and the Mines and Minerals (Development and Regulation) Act, 1957.
'The opening up of commercial coal mining for private sector is the most ambitious coal sector reform since the nationalisation of this sector in 1973," the minister said.
India is said have coal reserves of up to 300 billion tonnes.