When the country’s attention has got focused on the issue of coal block allocation, those closely associated with the coal mining sector here are especially pointing to the amendment in the Coal Mines (nationalisation) Act, 1973, which allowed private sector participation in captive coal mining for power generation and a 2011 review of the coal mining policy that permitted the state government companies or undertakings to do mining of both cooking and non-cooking coal reserves.
A former Coal India chairman told this newspaper that the amended policy guiding the coal mining sector has opened the coal mining sector for joint ventures that do not have to go through the same allocation route that has been questioned by the CAG.
In December 2001, the coal mining policy was reviewed and the Union ministry of coal and mines had then written to all state chief secretaries permitting the state government companies or undertakings to do mining of both cooking and non-cooking coal reserves either by open cast or underground method anywhere in the country.
In April 2011, the coal ministry decided that small isolated pockets will be allotted to state mining corporations under section 3(3)(a)(i) of the Coal Mines (Nationalisation) Act, 1973. Taking advantage of the revised policy, the Madhya Pradesh government has gone in for extensive coal production in the joint sector with the state-owned Madhya Pradesh State Mining Corporation Limited (MPSMCL) forming several joint venture companies, including MP Sainik Coal Mining Pvt. Ltd with Sainik Aryan Group; M.P. Jaypee Mineral Ltd with Jaiprakash Associates Limited (JAL); M.P. AMRL (Semaria) Coal Company Limited, M.P. AMRL (Bicharpur) Coal Company Limited, M.P. AMRL (Marki Barka) Coal Company Limited, M.P. AMRL (Morga) Coal Company Limited, all joint ventures with ACC Mineral Resources Limited; and M.P. Monnet Mining Company Limited, a joint venture with diversified conglomerate Monnet Ispat. The Coal Mines (nationalisation) Act, 1973 restricted the mining of coal only by companies owned or controlled by the government.
After an amendment in the act in 1976, captive mining was allowed by the private companies engaged in production of iron and steel and sub-lease of coal mining in isolated small pockets.
Further, the amendments in 1993 allowed the private sector participation in captive coal mining for generation of power, for washing of coal obtained from a mine or for other end uses to be notified by the government.