India to allow foreign firms mine and sell coal: Coal Secretary
New Delhi: Locally registered firms will now be allowed to mine and sell coal when commercial mining is permitted in India.
According to Coal Secretary Anil Swarup, India will allow locally registered foreign firms to mine and sell coal when commercial mining is permitted as part of the opening up of the nationalised industry after four decades.
Modi government has agreed to send about $1 billion by 2019 to buy railway wagons and transport coal from remote mines. Through this the government hopes to end coal shortage that has crippled power plants and curbed India's import of fuel.
Swarup told media that the decision will open the door to global giants like Rio Tinto (RIO.L) and BHP Billiton (BHP.AX) and help ramp up output from India's huge reserves - the world's fifth biggest.
“Any company registered in India can bid (when a commercial coalfield auction takes place). So a foreign company registered in India can also bid, provided they fulfil other conditions” he added.
As of now, only power, steel and cement companies can mine coal for their own consumption. Commercial mining in India is dominated by state-owned Coal India Ltd.