Coal India set to diversify into non-coal mining areas

After the demand for coal kept on decreasing for most of this year amid the Coronavirus pandemic impacting economic activities, Coal India Ltd (CIL) has decided to diversify into non-coal mining areas as well as invest in a big way in clean technology in 2021.

Against all odds, the government opened up the country's mining sector for private players by auctioning 19 blocks. Coal demand across the world has been projected to fall by around five per cent this year compared to that of last year while various sectoral challenges are expected to persist in 2021, it is understood.

"In 2021, we will try to get Coal India Ltd (CIL) to diversify into non-coal mining-related areas. It (CIL) will make major investments in sectors other than coal mining so that it is well prepared to make the transition away from fossil fuel. "So, it (CIL) will make investments in renewable energy, get into aluminium and clean coal technology and will do a lot," said Coal Secretary Anil Kumar Jain.

“In the coming year, CIL is also likely to go ahead with its agenda of achieving one billion tonnes of production target by 2023-24. CIL may also go ahead with its agenda of producing one billion tonnes. It has been getting approvals and is gearing up to keep enhancing its production which was 603 million tonnes last year. It is taking upon itself bigger and bigger target. It will be able to achieve one billion tonnes (production target) in 2023-24," Jain remarked.

Noting that CIL has taken upon itself an investment plan of Rs 2.5 lakh crore, Jain said that out of the proposed outlay, a significant chunk would be spend on clean coal technologies and diversification. The rest of it will be used to increase coal production, Jain noted.

Taking about 2020, Jain said that auction of commercial coal blocks was number one achievement (in the coal sector). We amended the Act to ease several things. The auction of coal blocks for commercial mining witnessed fierce competition and the 19 blocks that went under the hammer will generate total revenues of around Rs 7,000 crore per annum and create more than 69,000 jobs once they are operationalised.

According to Jain, the government facilitated the mining plan and made it eco-friendly to promote ease of business. The coal ministry took initiatives to re-visit old laws with an aim to improve efficiency, ease of doing business, and to open up coal sector to improve domestic coal production and reduce imports.

Prior to amendments in the mining law, there was dominance of public sector companies both in exploration and mining of coal. The Mineral Concession Rule, 1960 was governing many aspects of coal mining and required amendment in furthering the coal sector reforms.