The Impressive TimesNew Delhi : The Union Cabinet Committee on Economic Affairs, chaired by Prime Minister Narendra Modi, has approved a groundbreaking policy titled CoalSETU (Seamless, Efficient & Transparent Utilisation) for long-term auction of coal linkages dedicated to any industrial use and export. The policy introduces a new “CoalSETU window” under the Non-Regulated Sector (NRS) Linkage Auction Policy of 2016, marking another major reform in India’s coal sector.
Under the new framework, any domestic buyer requiring coal for industrial purposes can participate in the CoalSETU linkage auction, significantly expanding access beyond the current system which restricts allocations to specific end-use sectors such as cement, sponge iron, steel, aluminium and captive power plants. However, coking coal will not be offered under this window, and traders will also be barred from participating.
The revised policy aims to simplify coal procurement by removing rigid end-use restrictions and aligns with the Government’s broader sectoral reforms, including opening coal mining for commercial purposes without end-use limitations. The move is expected to accelerate utilisation of existing coal reserves and lower the country’s reliance on imported coal.
The new CoalSETU window will operate alongside the existing auction mechanism, which will continue to cater to specified end-user sub-sectors. Importantly, these specified consumers will also be eligible to participate in the CoalSETU auctions.
Coal linkage obtained through this window may be used for:
Own industrial consumption
Export of coal (up to 50% of linkage quantity)
Coal washing and related purposes
Resale of coal within India remains prohibited. However, linkage holders will have the flexibility to distribute the coal among group companies based on operational needs.
The policy is also expected to encourage washery operators, leading to higher production of washed coal—an important step toward reducing imports and improving fuel efficiency. Surplus washed coal may additionally be exported, offering new market opportunities.
With the coal sector undergoing rapid reforms, the CoalSETU window is designed to ensure fair access, transparency, and optimal utilisation of domestic coal reserves, contributing to the nation’s long-term energy security and industrial growth.
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