The Indian government is considering inviting foreign companies to bid for coal mining blocks in the country for the first time, Reuters reported Sept. 18, citing sources familiar with the matter.
The South Asian country is planning to auction coal blocks before the end of the year amid rising coal imports, which climbed year over year by about a third to 56.2 million tonnes during the second quarter, as demand continues to rise.
The companies with the winning bids will be approved to start development by early 2020, three sources said.
The move is expected to break state-owned miners' near-monopoly on coal; the government only allows Coal India Ltd. and another state-owned miner to produce and sell coal in the country.
The auctions are expected to draw interest from foreign mining majors including Glencore PLC, BHP Group, Anglo American PLC and Peabody Energy Corp. as well as local companies including Adani Enterprises Ltd. and Vedanta Ltd., according to the report.
The interest from Indian or Asian parties would mainly depend "on the nature of blocks offered, and also on any government efforts to reduce bureaucratic hurdles and improve infrastructure," independent global metals and mining equity consultant Satyadeep Jain said.
In 2016, India's Coal Ministry postponed plans to auction off coal blocks amid struggles to manage high coal production and low demand.
