While only Indian power, steel and cement companies are allowed to mine their own coal domestically under the existing laws which make Coal India the dominant producer in the blackout-plagued country, a source has hinted of big changes ahead to Reuters.
“The government now plans to allow companies like Rio Tinto India to mine coal commercially after it completes the auction of 74 coalfields for the exclusive consumption of Indian companies' power, cement and steel plants, said the source, who did not want to be identified as he is not authorised to speak to the media,” the newswire reported.
“In a 27-page executive order posted on the Coal Ministry's website on Wednesday, the government said any firm incorporated in India may be allowed to mine coal for their own consumption or sale, ending a 42-year-old ban. The document did not make any direct reference to allowing foreign firms.”
Rio Tinto India managing director Nik Senapati declined to comment.
“Other foreign players that may show interest in India are BHP Billiton and US firm Peabody,”Reuters reported.
“A Coal India official said it would be natural for the government to allow deep-pocketed foreign companies to mine coal, given the need to invest heavily and quickly raise output.”