Indian government may open coal mining for private companies.

A positive sign for foreign direct investment in coal mining sector for foreign and domestic private companies has been indicated by the Indian government. The Government of India is planning to open the mining sector for private companies with an intention of reducing the gap between demand and supply of coal. At present only state-owned companies like Coal India Ltd (CIL) are allowed to mine coal in India but private companies are allowed only to mine only for their captive consumption.
In furtherance of this, a bill was earlier introduced in Rajya Sabha by NDA government in year 2000 which is still pending and the bill is likely to be revived by the government after the passing of Union Budget next month. With the passing of this bill the Indian coal sector may see and experience its first overhauling as foreign companies like Rio Tinto and domestic companies will be allowed to enter this sector which may lead to a good competition among them and shooting up the ending economy. It will also reduce India’s dependence on coal imports to meet the need of domestic market. India produces approximately 450 million tonnes of coal annually which is less than 50 million tonnes as per the need of domestic consumption. It is expected that the coal requirement can shoot up to 1,000 million tonnes by 2030.