In a critical step towards revitalizing India's coal sector, the Ministry of Coal has introduced a series of transformative policy measures aimed at promoting underground coal mining. These 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. Ministry of Coal has introduced a robust package of incentives. It has announced a reduction in floor revenue share. The floor percentage of revenue share for underground coal mines has been reduced from 4% to 2%. This targeted reduction offers substantial fiscal relief and enhances the financial viability of underground projects.
The ministry has also offered a waiver of upfront payment: 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% rebate on performance security for underground coal blocks, collectively lowering the entry threshold and facilitating smoother project implementation.