Private coal mining may get a boost; government planning to amend Act to facilitate land acquisition

Most of the mines earmarked for commercial auctions are located in Madhya Pradesh (11), followed by Chhattisgarh (9), Jharkhand (9), Odisha (9) and Maharashtra (2).

The government is planning to amend the Coal Bearing Act (CBA), 1957 to allow land acquisition for commercial coal mining by private sector players. “The proposal is currently in the consultation stage in the ministry, but if the Parliament approves it, such land can be acquired under CBA and leased out to the private sector,” said M Nagaraju, joint secretary and nominated authority, ministry of coal.

The CBA currently allows special relaxations for land acquisition only to state-owned companies such as Coal India and its subsidiaries.

“I do appreciate that to get a coal mine operational, allocatees have to get permission from various agencies, which is time consuming,” said Anil Kumar Jain, secretary, coal ministry. The officials were speaking at a webinar for the stakeholders of commercial coal mining auctions. The government on June 18 had launched the maiden auction for coal blocks without any end-use restrictions, and technical bids are scheduled to be submitted by September 29.

Speaking about the potential concerns of the lenders about the auctions, Prabodh Parikh, deputy managing director of SBI, said that clarity is needed with respect to land acquisition as some offered blocks fall in areas which had been earlier designated as ‘no-go zones’. The rehabilitation and resettlement is the responsibility of the coal mine developer, which can be problematic as a lot of areas fall in eco-sensitive forests and tribal lands, Parikh pointed at the event organised by the Federation of Indian Chambers of Commerce and Industry.

Most of the mines earmarked for commercial auctions are located in Madhya Pradesh (11), followed by Chhattisgarh (9), Jharkhand (9), Odisha (9) and Maharashtra (2).

Responding to Maharashtra’s objection, the Centre is not putting up the Bander mine for commercial coal auctions. Also, it is considering to replace four mines with 20 million tonne per annum capacity in Chhattisgarh at the state government’s request. Lenders are also concerned about the feasibility of coal projects as rising renewable energy is seen to impact demand and put additional pressure on coal prices in the future.