The Indian government allows full foreign investment in coal mining projects
New Delhi: the Indian government has further eased restrictions on foreign investment in commercial coal mines in India as part of efforts to boost the country's economic growth.
India's cabinet met on August 28 to discuss the proposal, according to people familiar with the matter.So far, the cabinet has approved the proposal to allow foreign investors to invest 100% of their money in coal mining projects in India.
Under the current foreign investment policy, foreign companies are allowed to fully invest in Indian power plant-owned coal/brown coal, iron ore and steel, cement projects and other approved projects, subject to compliance with applicable laws and regulations, according to people familiar with the matter.
Discussions on opening rules for foreign investment in coal mining have been going on for more than a year.Although most developed countries are phasing out fossil fuels, India's demand for them is growing.As Asia's third-largest economy, opening up to foreign investment in coal mining could solve India's fuel shortages and revive the country's economic growth.
India's economy grew by 5.8 per cent in the first three months of this year, the slowest pace since 2014, before falling further to 5.7 per cent in the april-june period, and is expected to slow further.
Nirmala Sitharaman, finance minister, waived a super-rich tax on foreign investment as part of a plan to reverse the economic slowdown, lifted a ban on new car purchases and announced a cash injection in state Banks.
Mr Sitaraman said the decision to allow 100 per cent foreign investment in coal mining would attract international investors and make India an efficient and competitive coal market.