The Government will issue an Executive Order to immediately set up the Coal Regulator, Finance Minister P. Chidambaram said on Friday.
The Finance Minister said earlier Pension Fund Regulatory and Development Authority (PFRDA) and Securities and Exchange Board of India (SEBI) were also set up under similar guidelines.
PFRDA continues to be under an Executive Order, while SEBI was later changed to a statutory body.
The Government takes this step as Parliament is not in session to approve a Bill.
Industry body CII said the regulator would make the sector more investment friendly and encourage more exploration.
“CII has been emphasising that the independent regulator for the coal sector should have the mandate of managing the allocation process, opening of new exploration areas, mine planning and development, compliance by developers and to act as a central repository of exploration data and pricing,” said Chandrajit Banerjee, Director-General, CII.
The Cabinet on Thursday gave its go-ahead for the setting up of an independent regulator for the coal sector.
According to the normal procedure, the Coal Regulatory Authority Bill 2013 needs to be placed before Parliament before it becomes a law.
The draft bill on Coal Regulatory Authority Bill, 2013 was submitted to the Cabinet for consideration on May 10, 2012. The panel decided to refer it to a Group of Ministers to sort out issues related to the powers of the proposed regulator.
On May 29, 2013, the Group of Ministers, headed by Chidambaram, gave its go-ahead for the Bill, taking the first step for an independent authority to tackle issues of pricing, supply and quality.
On May 7, Chidambaram had said the proposed regulator would not have the power to set coal prices – the most contentious issue. Now, it is to be seen how the Government separates the powers between the proposed regulator and the Office of the Coal Controller.
At present, powers such as approval for coal mining rests with the latter.
The Coal Ministry has not yet decided on dismantling the Coal Controller. The proposed regulator is expected to have the authority to approve methods of testing, sample collection and weighing, among others.