The government of India has promulgated the Mineral Laws (Amendment) Ordinance 2020 that aims at attracting investors in the coal mining sector by removing restriction on end-use and prior experience in coal auctions. The objective is to foster investment in coal mining, and to reduce imports, which reached INR1,710bn (US$24bn) over the last fiscal year.
In addition, the Ministry of Environment has approved 10 coal mining projects with a total capacity of 160 Mt/year and four washeries that can wash 31 Mt/year of coal. The list of cleared projects includes 7 mines and 2 washeries with capacities of 141 Mt/year and 15 Mt/year respectively proposed by Coal India, including the Kusmunda opencast coal mine in Chhattisgarh developed by Coal India's subsidiary South Eastern Coalfields and that should reach 62.5 Mt/year at peak capacity. These approvals should help Coal India meet its production target of 750 Mt of coal in the next fiscal year (April 2020-March 2021).
In August 2019, the government relaxed its investment rules to open coal mining to foreign players. The new regulation authorises 100% foreign direct investments (FDIs) in coal mining and all related processing activities, without approval from the government or from the Reserve Bank of India (“direct route”).
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