Written byShalini Ojha
"We are not just launching the auction for commercial coal mining today, but bringing the coal sector out of decades of lockdown," he announced.
He reiterated that the coronavirus crisis must be turned into an opportunity.
In January, the Union Cabinet approved the Promulgation of Mineral Laws (Amendment) Ordinance 2020, which allowed holding companies and subsidiaries to use coal "in any of its subsidiaries or holding companies".
Companies that didn't have coal mine operations in India were also allowed to participate in auctions.
In August 2019, the government also allowed 100% FDI in coal mining for sale through an open route.
These steps were taken to minimize India's coal imports and encourage more use of coal reserves, which were restricted to the steel and power industry.
Despite having the fourth-largest coal reserve in the world, India imported 235 million tonnes of coal last year, revealed Coal Minister Pralhad Joshi.
India's reserves could have easily made up for 135 million tonnes of this import, he added.
Welcoming the move, CII President Vikram Kirloskar had said, "The opening up of coal sector without end-use restrictions will also boost both production and mining efficiency, besides substituting import of coal worth approximately Rs. 30,000 crore."
Last month, when Finance Minister Nirmala Sitharaman detailed the fine-print of the Rs. 20 lakh crore Aatmnirbhar Bharat package, announced by PM Modi to help the battered economy, she mentioned coal too.
She announced Rs. 50,000 crore aid for the development of the sector.
Sitharaman announced the government will bring about "competition, transparency, private sector participation" in the coal sector via "revenue sharing mechanism".
Today, green-lighting the auction, PM Modi said it's time to become self-reliant.
"The government has taken an important decision to open up coal, mining sector to competition, capital, and technology. Commercial coal block auction is a win-win for industry users and states," he went on.
The auction of 41 coals blocks could get Rs. 33,000 crore of capital investment in the next 5-7 years.
"We have set a target to gasify around 100 million tonnes of coal by 2030. I have been told that 4 projects have been identified for this and about Rs. 20,000 crore will be invested in them," PM Modi added.
The prime minister said that for decades India's coal reserves were stuck in a web of captive and non-captive, remained out of competition, and there was no transparency.
This decision, along with other steps taken since 2014, will rectify the same, he claimed.
"Maamla to koyle ka hai, par heere ke sapne dekh ke chalna hai," the BJP leader went on.
Love Business news?
Subscribe to stay updated.