CoalSETU window

Why in news?

The Union Cabinet Committee on Economic Affairs has approved the Policy for Auction of Coal Linkage for Seamless, Efficient & Transparent Utilisation (CoalSETU) by creation of "CoalSETU window".

• CoalSETU window – It is a new policy mechanism that allows the coal linkages to be auctioned for diverse industrial uses and exports, with the aim of ensuring fair access and optimal resource utilization.
• Operated under – Ministry of Coal.
• Aim – To optimize the utilization of domestic coal resources and reduce dependence on imports.

Key Features

• Auction-based allocation – Coal linkages will be auctioned on a long-term basis for any industrial use or export.
• No end-use restrictions – Unlike the earlier NRS (Non-Regulated Sector) policy (2016) –
  • Which limited coal to specified sectors (cement, sponge iron, aluminium, etc [excluding Fertilizer (Urea)]), the new window allows broader participation.
• Alignment – It matches with earlier coal sector liberalization (commercial mining without end-use restrictions).
• Exclusion – The coking coal will not be offered under this window.
• Export allowance – The coal linkage holders can export up to 50% of their allocated coal.
• Flexibility – Coal linkage holders may utilize the coal flexibly for their own consumption, export, coal washing, or any other purpose, including distribution among their group companies.
• Restrictions – Traders barred from participation, resale within the country prohibited.
• Impact – It simplifies coal procurement for industries, increased availability of washed coal domestically, reduced imports, export potential for washed coal, strengthening India’s global presence.

References

1. PIB | Cabinet approves CoalSETU window
2. DD News | Cabinet approves CoalSETU window