update

     Meanwhile, the government is likely to finalize policy on utilisation of surplus coal from captive mines by the next month. The government has prepared a draft and has been circulated to various ministries/departments for obtaining their comments. The move came after reports of sale of surplus coal by some private parties in open market against norms of captive coal block use.

      According to the Coal Mines (Nationalisation) Act, 1973, there is no provision of sale of coal from the coal blocks allotted for captive use. The government can take appropriate action against the allocattee company including de-allocation of the block that violates norms of the use of surplus coal. Recently, the government came to know about the sale of coal in open market from Takli Jena Bellora (South Part) coal block allocated to private firm Central Collieries Company for captive use. Earlier, in the backdrop of the govt's proposed surplus coal policy, Power Ministry has also asked private firms to return excess fuel mined from captive blocks to state-run Coal India.

      Coal is dominant fuel used for power production in the country. Coal-fired plants account for 59% of India's installed electricity capacity. In order to enhance the domestic coal production, government has been allocating coal mines to private players. Indian domestic coal demand is presently around 35 percent higher than domestic supply, resulting into a high deficit of which a huge part is being met by costly imports from Indonesia, South Africa and Australia.