Coal mining: Govt to ease revenue share, prior experience conditions

The government is apparently going the whole hog in removing the impediments to investments in coal mining. Close on the heels of a Cabinet decision earlier this month to remove end-use restrictions on miners in the sector that virtually abolished the concept of captive coal mining, the Union coal ministry has now floated a discussion paper that proposes to do away with the requirement of prior experience for prospective bidders for coal blocks. Also, the paper says that the revenue which developers need to share with the states will not be linked to coal prices quoted by state-run Coal India (CIL). Private players had earlier raised objections to these two conditions and cited them as reasons for their showing little interest in the sector.

The coal ministry also said that it is developing a ‘National Coal Index’ to fix the price of coal for commercial mining, which would include a weighted combination of monthly prices of coal in various channels of transaction.