India to set up Coal Exchange

India is to set up Coal Exchange trading platform soon. According to the proposal to set up the India Coal Exchange platform, the entire coal mined in the country is to be traded on a common platform called “Coal Exchange”.

Why is Coal Exchange important?

It is important to set up the trading platform as it will pave way for multiple buyers and sellers in coal sector. It is to be noted that the coal ministry will start auctions for commercial coal mining on June 11, 2020.

Background

The Union Finance Minister Nirmala Sitaraman had announced that the monopoly of the Government in the coal sector will be removed completely. This is being done to increase production of coal in India and reduce its dependence of imported coal. India holding third largest coal reserves in the world is still importing coal.

About Coal Exchange

Though India opens the coal sector to market access through the platform, Coal India will remain the dominant player in the coal sector. This is mainly because of its fixed target and allocated coal production of 1 billion tonnes by 2024.

Month: Current Affairs - June, 2020