Coal mining industry at the crossroads: Towards a Coal policy for liberalising India

This paper presents an analysis of the current status of the Indian coal sector, which is
poised for major changes with liberalisation and privatisation of the Indian economy, and
critically analyses some policy issues. The state-owned Coal India Limited has been ailed
by economic problems and has been responsible for causing serious social disruptions and
environmental hazards in its areas of operation. The monopoly status that the public sector
companies have enjoyed for over 3 decades has acted as a disincentive in improving the
social and environmental performance of the industry, the major effort being put on
improving the operational processes through the introduction of technology. The
substantial liberalisation of the sector would need to prioritise not only a more integrated
and investor-friendly regulatory environment but also take a close look at some old laws of
colonial vintage, at issues relating to social equity and justice, and incorporate some of the
international compliance standards being put forth by the international agencies. The paper
also suggests that the government must develop and implement an integrated energy policy,
of which coal is a part. Moreover, it must develop efficient coal markets and raise India’s
profile in the world coal markets, commensurate with India’s status as the third-largest coal
producer in the world.