Private companies will be allowed commercial coal mining soon: Jaitley
A day after deciding to e-auction coal mines cancelled by Supreme Court to captive users, finance minister Arun Jaitley on Tuesday said commercial mining of coal will soon be opened for private sector firms.business Updated: Oct 21, 2014 17:46 IST
A day after deciding to e-auction coal mines cancelled by Supreme Court to captive users, finance minister Arun Jaitley on Tuesday said commercial mining of coal will soon be opened for private sector firms.
"They (private companies) are already there for end use (captive mining)... I can't bind myself by a timeline, but there would be some players, hopefully very soon they should be there in the field," he said, when asked when the private sector would be allowed to enter the coal mining without end-use restrictions.
Currently, only Coal India, the world's largest coal miner, and its smaller sister PSU Singareni Collieries besides mining agencies of state government are allowed commercial coal mining.
In 1993, private sector participation in mining of coal for captive use by industries like steel, cement and power producers was allowed.
In an interview to NDTV, Jaitley said the ordinance the government is issuing to allocate the coal mines cancelled by Supreme Court to state-owned power generator NTPC and state electricity boards as well as e-auction, has an enabling clause to allow private sector in commercial mining later.
"In the first round we have given it to the actual users and this we intend completing in 3-4 months. After this is done, the government can immediately thereafter, so sometime thereafter, start using that enabling power which has been given under the enabling Act. Therefore it is a much needed step forward," he said.
He was asked when the private players will be allowed in coal mining.
The finance minister, however, categorically stated that the nature and structure of Coal India Ltd, the world's largest miner, will not be changed and there will be no privatisation of the company.
"Privatisation would involve if you are privatising Coal India. That's not what we are doing. Coal India remains Coal India. It will remain the principal player, but in competition you can also have some private players coming in. They will be much smaller private player because nobody can match the size of Coal India. But you will have several smaller players," he said.
Private firms are being allowed in to increase coal output so that power generation can be increased. On diesel regulation, Jaitley said his government has implemented the decision which was taken by the UPA.
"All we have done now is implement the decision which the UPA has taken and fortunately for us the market price is low.
"The diesel deregulation will be like the petrol deregulation, except that I understand that there is some head space in terms of money which the oil companies have reserved for themselves so there capacity to absorb some of it is there. If prices rise beyond that absorption capacity the price will go up."