A government policy on project financing in coal mining is on the anvil to boost development of private commercial mining in the country amidst increasing opposition to back such projects over environmental concerns worldwide, an official said on Monday. The government also indicated that, in all likelihood, the second tranche of commercial coal mining auction will not be suspended due to the COVID-19 pandemic, but the Ministry of Coal will monitor the situation and make a decision consequently, the official said after a virtual meeting the authorities had with prospective bidders.
"At the virtual pre-bid meeting for the second tranche of coal mining auction, the government said that it will come out with a policy on project financing in coal mining," the official said.
A policy on this issue is being discussed in the
government as funding coal mining projects is gradually becoming a challenge in wake of growing opposition globally. Protestors assert that such dirty projects cause damage to the environment. A nationalised bank has reportedly been unable to reach a final decision on financing a major coal mining project in Australia due to such opposition.
Owing to mounting pressure, global mining majors have not shown any interest in the commercial coal block auctions by India. Mining of the dry fuel has been a monopoly to state-owned Coal India Limited.
Meanwhile, the government indicated to the prospective bidders during the pre-bid meeting that the Ministry of Coal will decide on the auction rendering to the coronavirus situation, the official said.
The government in March offered 67 coal mines for sale, launching the second tranche of commercial coal mining auction and termed it a step towards 'Aatmanirbhar Bharat'. This is the highest number of mines on offer in a particular tranche after commencement of the auction regime in 2014.
The blocks on offer are a mix of mines with small and large reserves, coking and non-coking mines and fully and partially explored blocks spread across six states - Chhattisgarh, Jharkhand, Odisha, Madhya Pradesh, Maharashtra and Andhra Pradesh.
The government expects that commercial coal mining will fetch in novel investments, create huge employment opportunities and improve socio-economic development in coal- bearing states, and a market-based coal economy will help the nation become self-reliant in coal.
