Cabinet Approves New Coalsetu Window To Expand Coal Linkages For Industrial Use & Export

(MENAFN- KNN India) New Delhi, Dec 12 (KNN) The Union Cabinet Committee on Economic Affairs, chaired by Prime Minister Narendra Modi on Thursday approved the introduction of a new 'CoalSETU window' under the existing Non-Regulated Sector (NRS) Linkage Auction Policy.

The policy aims to ensure seamless, efficient, and transparent utilisation of domestic coal by allowing long-term coal linkages for any industrial use as well as for export.

Under the revised framework, coal linkages will be allocated through auction to any domestic buyer requiring coal, without end-use restrictions.

This marks a significant expansion from the current NRS linkage system-introduced in 2016-which allocates coal only to specified sub-sectors such as cement, steel (coking), sponge iron, aluminium, and captive power plants. Coking coal, however, will not be offered under the new window.

The Government stated that evolving market conditions and the need to accelerate utilisation of domestic coal reserves warranted a fresh review of the existing linkage mechanism.

The CoalSETU window aligns with broader coal sector reforms, including commercial mining, which similarly removed end-use constraints to improve market efficiency and reduce reliance on imported coal.

While the existing NRS auctions for designated end-user industries will continue, these industries may also participate in the CoalSETU window. Participation by traders will not be permitted.

Coal allocated under this window will be allowed for own consumption, coal washing, or export, but resale within the country will be prohibited.

Linkage holders will be able to export up to 50 per cent of their allotted quantity and may flexibly allocate coal among their group companies.

The Government also noted that expanded linkages to washery operators are expected to increase the availability of washed coal domestically, reduce import dependence, and tap international demand for processed coal.

The CoalSETU mechanism adds to the series of ongoing reforms in the coal sector aimed at enhancing transparency, promoting efficient resource allocation, and optimising the utilisation of India's coal reserves.

(KNN Bureau)

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