Steel Ministry to get control of coal, iron ore mining

The government is planning to hand over control of iron ore and coking coal mining to the steel ministry, as mining of coking coal is getting expensive and more time consuming.
Image used for representational purpose. (File | AP)
Image used for representational purpose. (File | AP)

NEW DELHI: The government is planning to hand over control of iron ore and coking coal mining to the steel ministry, as mining of coking coal is getting expensive and more time consuming, two officials familiar with the development said.

“At present, coking coal production is very expensive, almost equal to the import of coking coal. So, it is not financially viable for coal companies. Steel majors like SAIL are already doing it for themselves, so it makes sense to shift it to the steel ministry,” said a coal ministry official.

“It will also help steel ministry to have integrated plan including coking coal and iron ore, which will speed up approval of mining licenses,” the official added.

The official also cited lack of expertise and manpower for the move. “Mining of coking coal needs different kind of expertise, technology and there is not enough manpower to do the job.”

The proposal is already under discussion and is awaiting approval from the ministries concerned. The steel ministry was already trying to formulate a policy on iron ore pricing; it will get further shot in the arm with the new policy shift.

“It will be a win-win situation for both mining and steel industry. While steelmakers will get iron ore and coking coal from the domestic market, it will reduce their dependency on imports and will help them fight any price volatility. At the same time, iron ore exporters were not able to be globally competitive due to higher export tax,” another official from the steel ministry confirmed.

The move will help coal ministry focus on improving their production and efficiency. “The government has decided to allot 11 coal mines to Coal India,” coal minister Piyush Goyal said. “Of the 11 mines, five are de-allocated blocks and six are fresh mines,” he said.

“The allotment of these coal mines to CIL will make its arms 100 million tonnes plus coal producing subsidiaries,” Goyal said, adding that these mines are located in Bihar, Jharkhand and Odisha.
He added that a panel headed by former CVC Pratyush Sinha is reviewing coal blocks auction mechanism, and is likely to submit its report in four to six months.

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