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New legislation for private coal mining proposed

By Our Special Correspondent

NEW DELHI SEPT. 22 . In a bid to involve the private sector in a big way in the coal industry, the Union Government plans to introduce legislative changes allowing for private mining while liberalising norms for allotment of captive blocks for trading in coal.

Addressing a conference here today on `Coal and electricity in India,' the Minister of State for Coal, Prahlad Singh Patel, said the Government was contemplating introduction of a new Coal and Lignite Bill to enable private sector mining on a commercial basis. The new Act would also allow competitive bidding for coal blocks, which would be overseen by an independent regulatory authority. The move was expected to boost coal production in the long term as production had to double in the next decade to meet the projected demand of 460 million tonnes at end of Tenth Plan and 620 million tonnes by 2012, the terminal year of the Eleventh Plan. The required investment to meet the projected demand had been estimated to be around Rs. 19,200 crores, he added.

The present policy of the Government permits private sector investment only for limited purpose of setting up washeries and captive mining for specified end uses such as power plants, fertilizer and steel units.

In his address at the conference, the Additional Secretary in the Coal Ministry, Lakshmi Chand, said allotment of captive blocks for setting up washeries in the private sector was also under contemplation. Captive block holders would also be permitted to sell coal in the open market, the idea being to foster competition in this sector, he said.

Mr. Chand said as many as 143 blocks had been identified for allotment with total estimated reserves of 30 billion tonnes. New policy initiatives were also on the anvil for grading and pricing of coal on the basis of gross calorific value as opposed to the concept of useful heat value (UHV) now in vogue in India.

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