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The government's move to set up a regulator for the coal sector would help bring in transparency, encourage exploration and enhance quality of the dry fuel, India Inc said on Friday.
"We welcome the move to set up an independent regulator for the coal sector and hope that this would make the sector more investment friendly and encourage more exploration," CII Director General Chandrajit Banerjee said.
Assocham Secretary General D S Rawat said that the coal regulator will ensure "transparency in pricing, quality and supply of coal". "The move to an independent authority, even if not all desired responsibility is vested in it, helps in transition to a more competitive industry structure and provides comfort of a balanced judgement, and application of due process," Leader, Energy Utilities and Mining at PwC India, Kameswara Rao said.
The government will issue an executive order for setting up a coal regulator aimed at regulating and preserving the dry fuel, after cabinet approval of the proposal last evening. However, industry was apprehensive over limited mandate of the coal sector regulator, as coal block allotment has been kept out of the purview of the proposed coal authority.
"CII has been emphasising that the independent regulator for the coal sector should have the mandate of managing the allocation process, opening up new exploration areas, mine planning and development, compliance by developers and to act as a central repository of exploration data and pricing," Banerjee said.
The regulator will be empowered to specify the principles and methodology for determination of price of raw coal and washed coal and any other by-product generated during washing.
"It is an inspiring move to embark upon issues of price determination, testing quality and monitoring the coal mines which would aid in setting a transparent framework to meet the huge demand and supply gap," President of PHD Chamber Suman Jyoti Khaitan said.
It will revive the corporate investments trajectory which currently is in its many years low, he added.