The Union Cabinet is likely to discuss a slew of proposals, announced in the recent ‘Atma Nirbhar Bharat’ package by finance minister Nirmala Sitharaman, in a meeting expected to be held on Wednesday.
These could include the much-talked-about proposal allowing commercial coal mining and may also include an ordinance on freeing up inter-state trade in agricultural commodities.
The legal framework on inter-state trade in agricultural commodities was announced by Sitharaman last week as part of her proposals to reform the country’s farming sector. This is to ensure multiple selling options for growers so as to break the stranglehold of licensed buyers.
In case of commercial coal mining, senior government officials said the auction methodology for awarding coal mines to private players for mining and commercial sale on the open market would be proposed to the Cabinet for its approval.
In January, the Cabinet had approved the amendments to the Coal Mining Special Provisions Act (CMPA), 2015, allowing anyone to mine coal in India. It eased the entry of foreign players and non-coal dependent companies in the sector.
“Taking the reforms forward, we have finalised the auction methodology for commercial mining. The proposal would also include eligibility criteria, rebate against mining target achievement and also changing tender to the revenue-sharing model,” said a senior official.
Revenue-sharing in the tender will replace the existing fixed payment of Rs per tonne to the mine hosting state. Now, the miner will share the revenue in accordance with the production.
The government, in the auction methodology, has also reduced by half the upfront amount paid by the bidder for a mine. “This will help garner interest for large mines whose upfront amount ran into more than Rs 1,000 crore,” said the official.
“Through earlier amendments, we freed up a lot of mines, including those partially explored. This has given the government a lot of mines which we can award under commercial mining,” said another coal ministry official.
In her four-part package, the finance minister, last week, announced reforms in the commercial coal and mineral mining sector.
The minister said there is a need to reduce import of substitutable coal and increase self reliance in coal production. For coal mining, the finance minister proposed a new set of regulations for awarding coal mines to private players for mining and sale.
Meanwhile, on the ordinance to free inter-state trade in agriculture marketing, sources said the Centre is expected to exercise powers vested under provisions of entry 42 of the Union list as per the Seventh Schedule of the Constitution.
This will be along with entry 33 of the Concurrent list that supersedes entry 26 of the State list to frame a legislation to regulate inter-state and intra-state movement of agriculture commodities. But Agricultural Produce Market Committees (APMCs) will continue to function as they used to.
The structure of the existing APMCs won’t be changed or altered.
Under the Seventh Schedule, that defines the powers of Centre and states, entry number of 42 in the Union list empowers the Central government to frame laws for inter-state trade, while the entry 26 of the Union list empowers states to frame rules and laws to regulate trade within the state.
But, the provisions of entry 26 of the state list is subject to entry number 33 of the Concurrent list which empowers both Centre and states to frame rules and laws relating to production, distribution and supply of foodstuffs, including edible oil and oilseeds.
In case of any dispute, the central law framed under the Concurrent list prevails and as the entry in the State list is subject to entry 33 of the Concurrent list, the Central government effectively has powers to frame law to guide both trade within states and even between states.