New Delhi, Oct 21: In a major move to bring reforms in the energy sector and mining, the Narendra Modi government will bring an ordinance which would allow e-auction of coal blocks for domestic companies.
The move comes against the backdrop of the Supreme Court last month that had quashed allocation of 214 coal blocks to various companies, which were mining since 1993.
"The Cabinet has recommended promulgation of an Ordinance to the President in order to resolve the pending issues particularly the situation arising out of the Supreme Court judgement quashing the allocation of the coal blocks," Finance Minister Arun Jaitley said briefing the media after the meeting on Monday. State sector requirements including those of the Central and state governments would be met and coal mines would be allocated to PSUs like NTPC or state electricity boards.
"As far as the private sector is concerned, the actual users of coal in the cement, steel and power sectors who apply for a certain number of coal mines will be put in the pool and there would be an e-auction. A sufficient and adequate number of mines would be put so that actual users go back with the mines," he said.
The minister said that the e-auction process would be transparent and completed in 3 to 4 months and the state governments will take the entire charges where the mines are located.
If the ordinance is given a thumb up, the biggest beneficiaries would be the states like Jharkhand, Odisha, Chhattisgarh, West Bengal, Madhya Pradesh, Maharashtra and Andhra Pradesh.
As per the ordinance, the coal-bearing land will be taken back from private companies whose mining licences were cancelled by the Supreme Court in September. The government will then hold an electronic auction of the mines for steel, power and other companies for their own consumption.
The move comes days after the government kicked off reforms in the energy sector by decontrolling diesel prices and hiking gas prices.
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