India should aim to become world's largest coal exporter: PM at launch of commercial coal mining

India should be the world's largest coal exporters considering the size of reserves it has, and unlocking of coal mining for commercial players is a step in that direction, Prime Minister Narendra Modi said on Thursday.

Launching the virtual auction process for 41 coal blocks for commercial mining, expected to garner Rs 33,000 crore of capital investment in the country over next 5-7 years, the Prime Minister said it is a major step in the direction of achieving 'self-reliance'. He also said that the coronavirus pandemic has taught India to be self-reliant.

The launch of the auction process not only marks the beginning of unlocking of the country’s coal sector from the “lockdown of decades”, but aims at making India the largest exporter of coal, PM Modi said.

Presently, despite being the world's fourth-largest producer, he said India is the second-largest importer of the dry-fuel.

"The country which in terms of coal reserves is the fourth-largest nation and is the second-largest coal producer, that country is not exporting coal. But is the second-largest importer of coal. The big question is when we are the largest producer in the world... If it is true, why can't we be the largest exporter," Modi said.

The PM further said, "We are committed to turning the coronavirus crisis into an opportunity." The Prime Minister said that the government has set an aim of gasification of 100 million tonnes of coal by 2030 with an investment of Rs 20,000 crore.

"We have kept an aim that by the year 2030, which means in this decade, around 100 million tonnes of coal should be gasified... For this, four projects have been identified and in them, around Rs 20,000 crore would be invested."

Lambasting past policies of keeping the sector closed and pointing out towards controversies and scams that shrouded the sector in the past, he said that now there is full transparency in auctions with a wide set of reforms. Commercial coal block auction will be a win-win for industry users, and new resources will open up with states getting more revenue and employment, he said.

The PM said that the government has taken important decision to open up coal, mining sector to competition, capital and technology and termed it a major step in the direction of India achieving 'self-reliance'. The PM said that this auction process will result in major revenues to states and create employment besides development of the far-flung tribal areas.

The commencement of auction process of these blocks, part of the series of announcements made under 'Atmanirbhar Bharat Abhiyan', are likely to contribute Rs 20,000 crore revenues annually to the state governments. In line with the Prime Minister's self-reliance call, the aim behind the auction process is to achieve self-sufficiency in meeting energy needs and boost industrial development.

The government has taken an important decision to open up coal, mining sector to competition, capital and technology, he said.

Coal and Mines Minister Pralhad Joshi, who was also present during the launch event, said Rs 50,000 crore is being invested in the sector to jack up India's coal output to 1 billion tonnes. With a view to achieving self-reliance in the coal sector, the Ministry of Coal in association with FICCI launched the process of auction of 41 coal mines under the provisions of Coal Mines (Special Provisions) Act and Mines and Minerals (Development and Regulation) Act.

Upon attainment of peak rated capacity of production of 225 million tonnes (MT), the government said, these mines will contribute about 15 per cent of the country’s projected total coal production in 2025-26. It will also lead to employment generation for more than 2.8 lakh people -- direct employment to approximately 70,000 people and indirect employment to approximately 2,10,000 people, as per the government.

Vedanta Group Chairman Anil Agarwal and Tata Sons Chairman N Chandrasekharan also attended the launch event. The decision was taken during a meeting of the Cabinet Committee on Economic Affairs (CCEA), chaired by the Prime Minister.

Finance Minister Nirmala Sitharaman, while announcing the stimulus package for the coronavirus-hit economy, had said coal mines would be auctioned to the private sector for commercial mining to end reliance on imports and improve local production.

The methodology approved by the CCEA provides that bid parameter will be revenue-share, the government had said, adding that bidders would be required to bid for a percentage share of revenue payable to the government.

(Image credits: Twitter/@BJP4India)