The Government proposes to set up a sovereign fund to finance acquisition of overseas mineral assets, said the Coal Minister, Mr Sriprakash Jaiswal.
The overseas mineral buyouts assume significance considering rising demand for coal from sectors such as power and steel even as the domestic production stagnates. Mr Jaiswal was speaking at a CII seminar on overseas coal acquisition.
Steel and fertiliser makers have been demanding creation of such a sovereign fund to finance overseas acquisition of mineral assets.
“Though Coal India has surplus resources for investing outside, it is important to have financial support from the Government for acquiring very large assets abroad,” Mr Jaiswal said.
Stressing upon the importance of energy security, Mr Jaiswal said that strategies need to be worked out to ensure uninterrupted energy supply for achieving projected economic growth.
The Coal Minister said that there are issues which need to be resolved urgently in regard to acquisitions abroad especially in view of the fact that other energy deficit countries are rapidly buying assets abroad.
The decision-making process needs to be fast-tracked and a policy support framework needs to be established to overcome risk aversion, he added.
Further, Mr Jaiswal said the proposed auctioning of the coal blocks were likely to start in about two months. The Government has shortlisted 54 coal blocks, which will be auctioned to companies for industrial use.
Replying to a query, Mr Jaiswal said the proposed coal regulatory Bill was likely to come before the Cabinet next week. He further said that the policy related to utilisation of surplus coal by companies with captive mines was likely to be finalised in the next few weeks.