Announcing the fourth tranche of economic measures to revive the economy from the COVID-induced slowdown, Finance Minister Nirmala Sitharaman announced commercial mining of coal on revenue sharing basis to increase its availability at market prices. The government has also increased FDI limit in defence manufacturing from 49 per cent to 74 per cent.
The commercialisation of coal mining will end the Centre’s monopoly in the segment. However, in order to minimise the coal usage, the government will provide incentives for gasification of coal. Initially, the government will offer 50 blocks for commercial coal mining. The Centre will allow liberalised entries for a range of coal blocks along with incentives.
The govenment will also corporatise ordnance factory boards to improve autonomy and accountability. However, it will not be privatised, emphasises the finance minister. There will be a separate budget for defence procurement. The government aims to enhance self-reliance in defence production. The government will notify weapons or platforms banned from imports. Indigenisation of some imported spares to be also given priority.
The Centre has also announced enhancing private investments in the mineral sector, including structural reforms to boost growth, employment and bring state-of-the-art technology.
It will allow a seamless mining and exploration regime. Joint auction will be conducted fir bauxite and coal blocks. Initially 500 mining blocks will be offered for the auction.
The government will also remove the distinction between captive and non-captive mines, while a mineral index will be brought in. Stamp duty rationalisation is another major decision announced by the FM on Saturday.
Addressing the media for the fourth time, the finance minister said that Saturday announcements would cover sectors including coal, minerals, defence production, civil aviation, power distribution in union territories, atomic energy and space.