The Union Cabinet has cleared the coal ministry’s proposal for setting up a regulator through an executive order for the coal sector. The regulator will, however, not have statutory powers and have no say in pricing of the fuel or allocation of captive blocks.
The Cabinet Committee on Economic Affairs which met on Thursday is learnt to have cleared the proposal under which the regulatory mechanism to be set up would be devoid of legislative and judicial powers as suggested by the law ministry as it would be set up through an ordinance.
Although the aim of setting up the watchdog is to contain the muck in the coal sector, which is currently dogged by controversies in allocation of coal blocks, but according to the proposal the ministry has retained its final say over crucial issues.
While the original plan was to have an independent watchdog for the sector, the UPA government could not see it through despite the Coal Regulator Authority Bill, 2013 being introduced in the Lok Sabha in December 2013.
The reason to dilute the regulator’s powers stems from coal ministry’s opposition. The ministry argues that since all coal mines were nationalised, the regulator’s role, especially for assuming executive functions needed to be carefully examined.