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GoM recommends 100% FDI in coal

The Group of Ministers set up by the Centre has recommended allowing 100 per cent Foreign Direct Investment under automatic route in both coal and non-coal mining sector, removing some of the present restrictions, Union Minister of State for Coal Dasari Narayana Rao said on Monday.

PTI|
Last Updated: Jan 16, 2006, 03.15 PM IST|Original: Jan 16, 2006, 03.15 PM IST
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KOLKATA: The Group of Ministers set up by the Centre has recommended allowing 100 per cent Foreign Direct Investment under automatic route in both coal and non-coal mining sector, removing some of the present restrictions, Union Minister of State for Coal Dasari Narayana Rao said on Monday.

The Centre was taking several initiatives to encourage the development of the mining sector and given its potential, the government was keen on promoting FDI in this sector, he told reporters here on the sidelines of the first Asian Mining Congress.

He said the GoM has recommended allowing 100 per cent FDI in both coal and non-coal mining sectors under automatic route.

The GoM's recommendation would be placed before the Union Cabinet soon for approval, he said.

Rao said the Centre has also set up a committee for studying in detail obstructions to investment in mining sector.

Earlier, inaugurating the programme, the minister said an expert committee had also been set up to suggest a roadmap for coal sector reforms.

The committee, he said, has submitted an interim report recently and the final report was likely to be submitted soon. These initiatives along with the necessary follow up measures would unfold significant potential for the growth of the mining sector. PTI SUN CR KM 01161453 DEL Rao said the Central Government was also working on an integrated policy to enhance the energy security of the country.

The Energy Coordination Committee headed by Prime Minister Manmohan Singh was currently examining various issues with a view to forge synergies for integrated development of energy sector including coal, oil and natural gas, non- conventional energy sources and electricity.

Coal, he said, would continue to play its lead role in meeting the energy needs of the country accounting for about 55 per cent of the total primary commercial energy requirements.

The coal minister said his ministry was aware of the increased demand for coal from the fast growing national economy. From the current annual demand of around 445 million tonne, the coal requirement was expected to increase to about 1260 mt by 2025.


Coal ministry, he said, was trying to take necessary measures to enhance indigenous coal production. While Coal India Ltd has been producing more than the targets given to the company, there was need for widening the production base.

Rao said besides expediting new coal projects, the government was promoting production of coal for captive consumption to meet the need of power, steel and cement sectors.
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