India Unveils CoalSETU Policy: A New Era in Coal Sector Reforms

The Indian government's latest coal sector reform, CoalSETU, aims to streamline coal linkage allocations through a new auction window. The policy will enhance domestic coal usage, reduce import reliance, and coincide with broader sector reforms. The move supports industrial use and export flexibility, excluding coking coal.

In a significant move to reform the coal industry, India's Union Cabinet Committee on Economic Affairs, led by Prime Minister Narendra Modi, has approved the Policy for Auction of Coal Linkage. Named CoalSETU, this policy introduces a new auction window within the NRS Linkage Policy to optimize coal usage for industrial and export purposes.

An official statement highlights that CoalSETU will facilitate long-term coal linkage allocations through auctions for industrial use and export, with a dedicated window for the NRS Linkage Auction Policy of 2016. It excludes coking coal, keeping focus on non-regulated sectors.

The revamped policy is part of broader initiatives to enhance ease of business, maximize domestic coal utilization, and cut reliance on imports. Emphasizing flexibility, Union Minister Ashwini Vaishnaw stated the plan aligns with opening India's coal sector to commercial mining. The policy excludes traders but benefits coal consumers by allowing varied usage within group companies and supports washeteries to expand washed coal availability domestically and internationally.

(With inputs from agencies.)