The coal ministry has circulated a notice about foreign direct investment (FDI) in commercial coal auctions. The move, directed at limiting the entry of Chinese miners that needs foreign investors to get approval from the government before sharing.
Earlier, the Centre had allowed 100 percent FDI under the automatic route for coal mining activity that includes associated processing infrastructure.
The press note released by the ministry
The ministry published a press note, summoning the improvement made to the FDI policy formed in April that regulates the entry of countries that share the border with India.
The Press Note 3 and modifications in the FDI Policy
“The Press Note 3 of 2020 has published by the Indian government, additional modified the FDI policy to propose a requirement to look prior government approval, if such foreign direct investment is by an entity from a country that shares land borders with India, or where the beneficial owner of such FDI into India is located in or is a citizen of any such country,” stated the corrigendum declared by the coal ministry for commercial coal auction.
Restricting the Chinese player’s entry into the Indian infrastructure space has taken priority amid heightened conflicts between the two countries that follow the Galwan Valley tension.
The boycott China movement and restriction on Chinese companies
Last month, the government had limited Chinese companies from participating in tenders for government appropriation without permission from appropriate authorities on defense and national security.
The top 10 coal miners of China comes under restriction.
Chinese mining companies such as China Shenhua and China Coal Energy come under the top 10 coal miners. The Centre had begun the coal mine auction for commercial mining and trade by private companies in June.
Foreign players, non-mining existences, and large miners are invited.
Bidding terms were liberalized to invite foreign players, non-mining existences, and large miners. In May, it improved the Coal Mines Special Provisions Act, 2015, to clarify the auction method and attract notable investor interest.
Declaration made by Prahlad Joshi on FDI policy.
Pralhad Joshi, Union coal minister, has declared in a current statement stated “100 percent FDI is the biggest reformation of our times. The entry of international players will build an economical and competing coal market.”
The commercial coal mining auctions with 41 blocks
The ministry has commenced operations for commercial coal mining auctions with 41 blocks. These are assumed to cumulatively make the mine-bearing states Rs 20,000 crore in annual revenue over the life of the mine.
The deadline for the sale of the tender document is August 14, and the expected date for tender submission is August 18. However, a notice dated July 30 declared that the ministry was estimating investors’ demands to extend the deadlines.
Apart from this, India has banned approx 59 Chinese apps after the conflict happened at the Galwan valley. Also, Vivo is taking steps back from IPL 2020 due to the tensions between both the countries. India is on full mode to restrict China from everywhere and taking step by step actions against it.