As part of the fourth tranche of announcements meant to provide economic relief, Finance Minister Nirmala Sitharaman on Saturday opened the coal mining sector for private participation.
"Commercial mining in coal sector to be brought in and government monopoly will be removed. The government will introduce competition, transparency, and private sector participation in the coal sector through revenue sharing mechanism instead of the regime of fixed rupee/tonne. Fifty new coal blocks for commercial mining will be offered immediately," said Sitharaman aas part of her media briefing on Saturday.
An amount of Rs 50,000 crore will be spent by the Centre for evacuation of mined coal. The is part of the Coal India Limited (CIL)'s target of 1 billion tons of coal production by 2023-24, in addition with those coming from private blocks.
Seamless composite exploration-cum-mining-cum-production regime will be introduced in mineral sector and 500 blocks will be auctioned, the FM said.
"Five hundred mining blocks would be offered through an open and transparent auction process, a joint auction of bauxite and coal mineral blocks will be introduced to enhance the aluminum industry's competitiveness," said Sitharaman.
The FM also announced rationalisation of stamp duty payable at the time of awarding mining leases.
So far, as part of the economic package, Sitharaman on Friday had announced Agri Infrastructure Fund worth Rs 1 lakh crore for farm gate infrastructure and a Rs-10,000 crore scheme for the formalisation of Micro Food Enterprises (MFEs) under the ₹20 lakh crore stimulus package.
"Prime Minister Narendra Modi had said we should prepare for tough competition. When we speak of "self-reliant India", we are not looking inwards, it is not an isolationist policy, it is making India rely on its strengths, ready to face global challenges," said Sitharaman.
She said the government has identified sectors that need reforms and these are coal, minerals, defence production, airspace management, airports, MRO, power distribution companies in union territories, space, and atomic energy.
"Many sectors need policy simplification, to make it simpler for people to understand what the sector can give, participate in activities and bring transparency. Once we decongest sectors, we can boost the sector, for growth and jobs," Sitharaman said.
Also, the government will introduce joint auction of bauxite and coal mineral blocks to enhance aluminium industry's competitiveness that will help the aluminium industry reduce electricity costs.
Further, the distinction between captive and non-captive mines will be removed to allow the transfer of mining leases and sale of surplus unused minerals, leading to better efficiency in mining and production.
This means that mines whose rights have been purchased by one miner for captive purposes can be transferred to another party that wants to take over for a non-captive reason.
A captive mine is one in which the miner has to necessarily use the mineral for their own purposes. The Ministry of Mines is in the process of developing a Mineral Index for different minerals.