The Center explained that any foreign direct investment (FDI) in commercial coal mining from an entity of a nation that shares land border with India will be permitted simply after government approval.
The Coal Ministry said, “This is with reference to the ongoing auction process of coal mines for commercial coal mining. It is further clarified that any FDI (foreign direct investment) in commercial coal mining is subject to applicable laws including the Press Note 3 of 2020 issued by the Central Government.”
According to the Press Note 3 of 2020, ‘an entity of a country, which shares land border with India or where the beneficial owner of an investment into India is situated in or is a citizen of any such country, can invest only under the Government route’, it added. Further, a citizen of Pakistan or an entity incorporated in Pakistan can invest only under the government route in sectors/activities other than defense, space, atomic energy and sectors/activities prohibited for foreign investment. A corrigendum to the tender document has also been issued in this regard, it added.
Foreign Direct Investment Policy, 2017 was amended vide the Press Note 4 of 2019, gave by the central government, to allow 100% FDI under programmed course in coal mining exercises, including related associated processing infrastructure, available to be purchased of coal, subject to the provisions of Coal Mines (Special Provisions) Act, 2015 and the Mines and Minerals (Development and Regulation) Act, 1957 and other applicable Acts regarding the matter.
Accordingly, it was stated in the tender document that “The Press Note 4 of 2019, issued by the Central Government, amended FDI Policy 2017, to permit 100 percent FDI under automatic route in coal mining activities, including associated processing infrastructure subject to the act and other applicable Laws, for sale of coal.”
It is further clarified that any FDI in the commercial coal mining is subject to applicable laws, including the Press Note 3 of 2020, the statement said.
Prime Minister Narendra Modi launched the auction process of coal blocks for commercial mining in June.
