The Indian Government plans to issue an ordinance to allow an e-auction for 74 coal mining licences to private mining companies in the next three to four months.
The decision came after India's Supreme Court cancelled 214 of the 218 coal mining licences awarded to private and public companies between 1993 and 2010, last month.
According to the government, the coal mining licences were allocated illegally to both private and government firms without performing competitive bids.
In order to end the four-decade-long monopoly on handling coal mining in the country, the government has decided to auction the mines to private sector firms, which will be required to use the coal produced at the mines and not sell it on, reported The Walls Street Journal.
India finance minister Arun Jaitley was quoted by Business Standard as saying: "The government will create a pool of sufficient and adequate number of mines for auction, through a transparent e-auction process for the private sector."
According to media reports, giving mining rights to private organisations would require changes in the Coal Mining Nationalisation Act 1973.
"Rules will be framed for commercial mining, under which the government could also decide commercial miners," Jaitley added.
"We want optimal utilisation of resources and reduction in the amount of imports."
In April 2000, the then Indian Government propsed a law to allot coal mines to private firms, but this was later dropped after outrage from various trade unions, reported Bloomberg citing the Press Information Bureau.
Image: Indian Government will sell 74 coal mining licences to private firms. Photo: courtesy of Flickr.