India's coal ministry may allow companies from all sectors to bid for coal and lignite mining licenses, with a first tranche of commercial mining auctions expected to start in the current fiscal year, The Economic Times (India) reported Jan. 2, citing a senior government official.

India recently outlined plans to offer more than 200 commercial coal mining blocks in the next five years. Initial auctions are expected to comprise about 40 mining blocks with peak annual mining capacity of 1 million tonnes to 50 million tonnes.

The ministry plans to release bidding rules and conduct stakeholder consultations this month, the report said. Under current regulations, only companies focused on iron and steel, power and coal washing can bid for coal and lignite mining licenses.

The anonymous government official said the move is expected to draw investment from Indian and global companies as well as mining majors such as Peabody Energy Corp., BHP Group and Rio Tinto according to the report.

"We have to remove the condition mandating bidders to be already engaged in coal mining operations in India, to open up the sector in the true sense," the official was quoted as saying.

This comes as India works to stop coal imports by power plants by 2024, the report noted.