In a major move towards energy sector reforms, President Pranab Mukherjee approved the coal ordinance proposed by the Cabinet last evening, paving the way for e-auctioning coal blocks for private companies. The ordinance, cleared by Union Cabinet in the backdrop of Supreme Court order quashing 214 coal blocks to companies since 1993, would allow private companies to bid for captive use and allot mines directly and central public sector undertakings.
With this, state sector requirements including those of the Central and state governments would be met through government dispensation route. Further, government intends to e-auction enough coal blocks for private sector players dealing in cement, steel and power sectors.
Meanwhile, Finance Minister, Arun Jaitley, underscored that e-auction process would be transparent and would be completed in a span of three to four months. Its proceeds would belong to state governments where the mines are located.
Additionally, he also stated that its biggest beneficiaries would be the eastern states like Jharkhand, Odisha, West Bengal and Chhattisgarh. States like Madhya Pradesh, Maharashtra and Andhra Pradesh would also benefit. All the companies could participate in this auction, except for those convicted by courts. However, this was riders given that there would be no right of first refusal and all the bidders would have to compete in the e-auction through reverse bidding.
