In a bid to break the monopoly of public sector coal companies, the government is planning to permit private coal mining companies to sell the commodity, thus overcoming the need for legislative changes.
"Coal ministry is currently in the process of finalising modalities for allotment of captive coal blocks for setting up coal washeries," secretary (coal) P K Mishra said in New Delhi on Monday, adding that the units would be permitted to offload the commodity in the market.
Mishra said the modalities were expected to be finalised within one or two months.
The move would have serious implications for public sector undertakings like Coal India that have monopolised the market due to restrictions barring private players from trading in the commodity.
It would also in one go enable the government to overcome stiff resistance from trade unions and political forces opposed to opening up the sector.
Unions had been opposing government moves to allow full-scale private participation in the sector through an amendment in Coal Mines (Nationalisation) Act, fearing that would open the doors to privatisation of public sector coal companies.
Under the Act, the government had permitted limited private sector participation through captive mining route and establishment of washeries for specified purposes. However blocks were not allotted for captive purposes as the ministry was of the view that it was not a specified end use.