Govt to form new policy for project funding in coal mining

As coal mining projects worldwide face increasing opposition over environmental concerns, the Indian government is set to frame a new policy on project financing in coal mining to support the development of private commercial mining in the country. After the virtual pre-bid meeting for the second tranche of coal mining auction, the government said that it would come out with a policy on project financing in coal mining, an official told the media. The government also indicated that, in all possibility, the second phase of commercial coal mining auction would not be postponed due to the Covid-19 pandemic, but the Ministry of Coal will monitor the situation and make a decision accordingly, the official said. A policy on this issue is being discussed in the government as financing coal mining projects is gradually becoming a challenge in the wake of growing opposition globally. Protestors claim that such dirty projects cause damage to the environment. A nationalised bank in Australia has reportedly been unable to make a final decision on financing a major coal mining project due to such opposition. Due to mounting pressure, global mining majors have not shown any interest in India's commercial coal block auctions. Mining of the dry fuel has been a monopoly to state-owned Coal India Ltd (Ltd). As we have reported earlier, the government in March offered 67 coal mines for sale, launching the second tranche of commercial coal mining auction and termed it a step towards ‘Aatmanirbhar Bharat’. This is the highest number of mines on offer in a particular tranche after the commencement of the auction regime in 2014. The blocks on offer are a mix of mines with small and large reserves, coking and non-coking mines and fully and partially explored blocks spread across six states—Jharkhand, Odisha, Madhya Pradesh, Maharashtra, Andhra Pradesh and Chhattisgarh. Image SourceAlso Read: Govt to permit sale of 50% coal from captive blocks Also Read: Amendment in Mining Act: A step towards building self-reliant India