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Government puts 25 coal blocks up for sale in 16th round of commercial auctions
Why in News?
25 coal blocks go up for auction, but the exam answer is the year captive-only mining ended
Centre launched the 16th round of commercial coal mine auctions, offering 25 blocks to boost domestic production.
Why it matters: asked in UPSC 2019; factual, Prelims-type
What you need to know
2 min read
The Union government offered 25 coal blocks for sale under the 16th round of commercial coal mine auctions.
Commercial coal mining, opened to private and foreign players since 2020 reforms, allows companies to mine and sell coal in the open market rather than only for captive use.
The auctions are aimed at boosting domestic coal production and reducing import dependence.
Sources: Topper IAS editorial (PIB / The Hindu / Indian Express)
Key facts
Remember these
- Union government launched the 16th round of commercial coal mine auctions, offering 25 blocks.
- Commercial coal mining was opened to private and foreign players through 2020 reforms.
- The reform lets companies mine coal and sell it freely in the open market, not just for captive use.
- Objective: boost domestic coal production and cut import dependence.
- Auctions are conducted by the Ministry of Coal.
Prelims · Mains
How the exam will ask it
Prelims
- Commercial coal mining, which permits sale of coal in the open market rather than only for captive use, was opened to the private sector in 2020.
- Before the 2020 reform, private companies could mine coal only for their own (captive) consumption, not for commercial sale.
- The 16th round of commercial coal mine auctions offered 25 blocks for bidding.
Mains
GS3 - Economy/Infrastructure: energy security. Issue: despite large reserves, India remains import-dependent for coal; Provision: 2020 reforms ended the captive-only restriction and opened commercial mining/auctions to private and foreign players; Implication: successive auction rounds (now the 16th) aim to raise domestic output and reduce costly imports, but actual production depends on timely allocation, evacuation infrastructure, and environmental clearances; Way forward: faster operationalisation of auctioned blocks and stronger logistics linkages to convert allocation into output.
PYQ connection
A question UPSC has already asked on this
Consider the following statements:
- Coal sector was nationalized by the Government of India under Indira Gandhi.
- Now, coal blocks are allocated on lottery basis.
- Till recently, India imported coal to meet the shortages of domestic supply, but now India is self-sufficient in coal production.
Which one of the following statements given above is/are correct?
- 1 only
- 2 and 3 only
- 3 only
- 1, 2 and 3
Show answer
Answer: A
Why this matters: today's issue is directly connected to a concept UPSC has already tested. Read the story with this question in mind.
Practise this PYQ →Quick recall
Answer before you reveal
Commercial coal mining, under which private companies may mine and freely sell coal in the open market rather than for captive use only, was opened up to the private sector in India in which year?
- 2015
- 2020
- 2018
- 2022
Show answer
Answer: B — Commercial coal mining was opened to private and foreign companies through reforms enacted in 2020, ending the earlier restriction to captive use and PSU mining.
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