GoM for 100 p.c. FDI in coal mining

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RE-LOOK AT POLICY: Union Minister of State for Coal, Dasari Narayana Rao, addressing Asian Mining Congress in Kolkata on Monday.
RE-LOOK AT POLICY: Union Minister of State for Coal, Dasari Narayana Rao, addressing Asian Mining Congress in Kolkata on Monday.

Special Correspondent

Panel to examine bottlenecks afflicting the mining sector

Centre working on integrated energy policyExpert panel for more captive coal miningInvestment to be stepped up

KOLKATA: The Group of Ministers (GoM) has approved 100 per cent foreign direct investment (FDI) under the automatic route in both coal and non-coal mining sectors, Union Coal and Mines Minister, Dasari Narayana Rao, said.

Inaugurating the first Asian Mining Congress here on Monday, he said while at present only the power sector was allowed FDI with regard to mining of coal without any ceiling, there was a 74 per cent cap for the steel and cement sectors.

He said the recommendation of the GoM would soon be put up before the Cabinet Committee on Economic Affairs (CCEA). The UPA Government at the Centre was taking several initiatives to encourage development of the mining sector and the government was keen on promoting FDI in this sector, he said.

The mining congress has been organised by the Mining, Geological and Metallurgical Institute of India (MGMI) as part of its centenary celebrations.

Mr. Rao said the government had also set up a committee for detailed examination of the bottlenecks afflicting the mining sector and to suggest ways of stepping up investment. The expert committee on coal-sector reforms had given its interim report, which recommended encouraging captive coal mining.

The Minister said the government was working on an integrated energy policy and the Energy Co-ordination Committee headed by the Prime Minister was now examining various issues in order to forge synergies for integrated development of the energy sector, including coal, oil, natural gas, non-conventional energy sources and electricity.

The Minister said although Coal India had been exceeding its production targets, there was need for widening the production base. Thirty-five coal blocks had been allocated to about 60 companies for captive consumption since the UPA Government assumed office. Another 12 blocks had been given to ten government companies. Together these 45 blocks have reserves of over ten billion tonnes.

The allocation, he said, was quite substantial since only 49 captive coal blocks with five billion tonnes of coal had been allocated between 1993, when captive coal mining was introduced, and 2004.

With measures in place for timely production of coal from the captive blocks, recently 20 more coal blocks with reserves of 2.5 billion tonnes had been allocated.

So far access had been provided to non-CIL blocks for a total of 115 projects in power, steel and cement sectors, he said. He asked the gathering to deliberate on technology issues to boost coal production.

BEML's joint venture

PTI adds: Bharat Earth Movers Limited (BEML) said it had entered into a three-way joint venture for diversifying into contract mining. "BEML will hold 45 per cent in the joint venture, while the two partners, one Indian and the other Indonesian, will control the remaining 55 per cent among themselves," BEML Chairman and Managing Director, V. R. S. Natarajan, told reporters on the sidelines of the International Mining Exhibition here on Monday. As the government was allotting coal blocks to private parties for enhancing coal production to meet future energy demands, the company was eyeing a huge business opportunity in this sector, he said.

The joint venture company was in the process of being formed and was awaiting approval from the government, he said.



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