Lok Sabha Question No. 132 (STARRED), answered on 2021-02-10
Subject: Commercial Coal Mining
Ministry: COAL
Asked by: Balubhau (Alias Suresh Narayan) Dhanorkar

## GOVERNMENT OF INDIA MINISTRY OF COAL LOK SABHA STARRED QUESTION NO. 132 TO BE ANSWERED ON 10.02.2021

## Commercial Coal Mining

## *132      SHRI BALUBHAU ALIAS SURESH NARAYAN DHANORKAR;

Will the Minister of COAL be pleased to state:

- a. whether the Government has completed the commercial coal mining auction process for private players;
- b. if so, the details thereof;
- c. the status of auction in Chandrapur district of Maharashtra; and
- d. the details of the proposal of the Government on foreign investment in this field through direct and/or indirect manner?

## ANSWER MINISTER OF COAL, MINES & PARLIAMENTARY AFFAIRS (SHRI PRALHAD JOSHI)

(a) to (d)  :       A statement is laid on the Table of the House.

## STATEMENT IN REPLY TO THE LOK SABHA STARRED QUESTION NO.132 TO BE ANSWERED ON 10.02.2021 ASKED BY SHRI BALUBHAU ALIAS SURESH NARAYAN DHANORKAR, HON'BLE M.P., REGARDING COMMERCIAL COAL MINING

..........

- (a)       Yes, Sir. The Eleventh Tranche of auction under the Coal Mines (Special Provisions) Act,  2015  (CMSP  Act)  and  First  Tranche  under  Mines  and  Minerals  (Development  and Regulation) Act, 1957 of coal mines for commercial mining was successfully completed on 9 th November, 2020.
- (b)        Ministry of Coal had launched the auction of 41 coal mines for commercial mining on June 18, 2020 under CM(SP) Act, 2015 and MMDR Act, 1957. The coal mines were from 5 coal bearing states viz. Chhattisgarh, Jharkhand, Madhya Pradesh, Maharashtra and Odisha.

The brief summary of the first tranche of commercial auction is given below:

- (i)  During the course of the auction process, 6 mines were withdrawn, and 3 new mines were added taking the total mines available for auction to 38.
- (ii)  A  total  of  76  bids  were  received for 23 against 38 coal mines from 42 bidders. Of these  23  mines,  2  or  more  bids  were  received  for  19  coal  mines.  Accordingly,  the technical evaluation was carried out for 19 coal mines.
- (iii)   The  e-auction  of  these  19  coal  mines  commenced  on  November  2,  2020  and successfully completed on 9 th November, 2020.
- (iv)  The  mines  successfully  auctioned  includes  16  mines  under  CMSP  Act,  3  mines under  MMDR  Act;   3  coking  coal  mines;  2  partially  explored  mines;  5  underground mines, 11 open cast mines and 3 mixed mines (OC+UG).
- (v)   The  coal  mines  have  been  successfully  auctioned  with  the  winning  percentage revenue share ranging from 9.5% to 66.75%. It is important to note here that the floor price  in  the  bid  document  was  stipulated  as  4%  of  revenue  share.  Average  percentage revenue share of ~27% have been received indicating strong demand for coal mines in market.
- (vi) Total  annual  revenue  generation  from  the  auction  is  estimated  at  ~Rs.6656crore considering  production  at  aggregated  Peak  Rate  Capacity  level  of  ~51  MTPA.  Total upfront amount of Rs.262 crore will be received by the States during the financial year FY 2020-21and the remaining upfront amount of Rs.786 crore will be received by the States subsequently, based on the milestones mentioned in the bid documents.
- (c)       Takli-Jena-Bellora  (North)  &  Takli-Jena-Bellora  (South)  situated  in  Chandrapur district of Maharashtra State was successfully auctioned in the recent tranche of commercial auction  of  coal  blocks  under  Coal  Mine  (Special  Provisions)  Act,  2015  to  M/s  Aurobindo Reality and Infrastructure Private Limited.

(d)       Government  has  reviewed  the  Foreign  Direct  Investment  (FDI)  policy  in  the  coal mining on 18.09.2019 allowing 100% FDI under automatic route for sale of coal, coal mining activity including associated processing infrastructure subject to the provisions of CMSP Act and MMDR  Act  as  amended  from  time  to time and other relevant Acts on the subject.   Associated  processing  infrastructure  includes  coal  washery,  coal  handling  and separation (magnetic and non-magnetic).

Accordingly, it was mentioned in the tender document of commercial auction of coal mines  that  "The  Press  Note  4  of  2019,  issued  by  the  Central  Government,  amended  FDI Policy 2017, to permit 100% FDI under automatic route in coal mining activities, including associated processing infrastructure subject to the Act and other Applicable Laws, for sale of coal.'  It  was  further  clarified  that  any  FDI  in  the  commercial  coal  mining  is  subject  to Applicable  Laws  including  the  Press  Note  3  of  2020  issued  by  the  Central  Government according to which 'an entity of a country, which shares land border with India or where the beneficial owner of an investment into India is situated in or is a citizen of any such country, can  invest  only  under  the  Government  route.  Further,  a  citizen  of  Pakistan  or  an  entity incorporated  in  Pakistan  can  invest,  only  under  the  Government  route,  in  sectors/activities other  than  defence,  space,  atomic  energy  and  sectors/activities  prohibited  for  foreign investments.'

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