Centre steps up efforts to boost eco-friendly coal mining

IANS April 24, 2025 210 views

India's Coal Ministry is revolutionizing the mining sector through innovative green policies targeting underground coal extraction. The new incentive package dramatically reduces financial barriers for mining companies, encouraging more environmentally responsible practices. By offering significant fiscal reliefs like reduced revenue share and waived upfront payments, the government is making underground mining more attractive. These strategic reforms represent a critical step towards sustainable energy development and India's broader economic self-reliance goals.

"By incentivizing underground mining, the Government is catalysing economic growth and driving the industry toward greater efficiency" - Ministry of Coal Statement
New Delhi, April 24: The Ministry of Coal on Thursday said it has stepped up efforts with a robust incentive package to promote underground coal mining which is more environment-friendly, as it causes significantly less surface disruption compared to opencast operations.

Key Points

1

Ministry offers substantial financial incentives for underground coal mining

2

Reduces revenue share from 4% to 2% for underground projects

3

Waives upfront payment requirements to encourage private sector participation

4

Aims to enhance ecological balance and energy security

The ministry has introduced a series of transformative policy measures aimed to encourage the adoption of advanced technologies—such as continuous miners, longwall systems, remote sensing tools, and AI-based safety mechanisms—which will boost productivity while ensuring ecological balance, according to an official statement.

These bold reforms address the traditional challenges of high capital investment and longer gestation periods, reaffirming the Government’s resolve to modernize the coal ecosystem while aligning with the broader vision of sustainable development, the statement explained.

As part of these reforms a strong package of incentives has been rolled out to accelerate the growth of underground coal mining. These include a reduction in the floor percentage of revenue share for underground coal mines from 4 per cent to 2 per cent. This targeted reduction offers substantial fiscal relief and enhances the financial viability of underground projects.

The mandatory upfront payment requirement for underground mining ventures has been completely waived off. This measure removes a significant financial barrier, encouraging broader participation from the private sector and facilitating faster project implementation.

These incentives are further complemented by an existing 50 per cent rebate on performance security for underground coal blocks, collectively lowering the entry threshold and facilitating smoother project implementation.

“The Ministry’s reform-oriented approach underscores its commitment to fostering a future-ready, investment-friendly, and innovation-driven coal sector. By incentivizing underground mining, the Government is not only catalysing economic growth but also driving the industry toward greater efficiency, safety, and employment generation,” the statement said.

These forward-leaning reforms mark a strategic shift toward cleaner and more sustainable coal extraction practices. They are poised to unlock the vast untapped potential of underground mining in India, fostering innovation, reducing carbon emissions, and contributing meaningfully to the nation’s energy security and Atmanirbhar Bharat objectives.

Reader Comments

R
Rahul K.
This is a step in the right direction! 👏 Underground mining causes way less environmental damage than opencast. Hope these incentives actually translate to real adoption by mining companies.
P
Priya M.
Interesting approach, but I wonder if 2% revenue share is enough incentive. The tech mentioned sounds expensive - will smaller players really benefit?
A
Amit S.
Finally some focus on sustainable mining practices! The AI safety mechanisms could be a game-changer for worker protection too. Hope this delivers on its promise.
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Neha R.
While I appreciate the environmental angle, shouldn't we be investing more in renewable energy instead of making coal mining "less bad"? Feels like we're polishing a sinking ship.
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Sanjay V.
The upfront payment waiver is smart - that was always a major hurdle. More companies might take the underground route now. Good for jobs in mining regions!
M
Meena P.
My father worked in coal mines his whole life. These safety improvements can't come soon enough. Hope they implement them properly across all sites.

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Tags:
Coal Mining Sustainable Development Ministry of Coal Underground Mining Green Technology Atmanirbhar Bharat
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