The coal sector's contribution to the government treasury rose by 2 percent in April-July

29 Aug 2024

In the April-July period of the ongoing fiscal year, state-owned Coal India Ltd's contribution to the government's exchequer rose 2.06 percent to Rs 20,071.96 crore.

According to preliminary figures released by the coal ministry, Coal India Ltd. (CIL), which accounts for more than 80 percent of the domestic coal output, remitted a sum of Rs 19,666.04 crore to the government exchequer during the previous fiscal year. The total levies paid to the government in July increased to Rs 4,992.48 crore from Rs 4,789.42 crore a year earlier.

The amount payable to the central and state governments includes royalty, GST, cess on coal, and other charges. Coal production generates substantial revenues both for the central and state governments.

In the first four months of FY24, the Jharkhand state government received the largest sum of money, namely Rs 4,417.12 crore, followed by the Odisha government at Rs 4,319.67 crore, Chhattisgarh at Rs 3,950.41 crore, Madhya Pradesh at Rs 3,526.27 crore, and Maharashtra at Rs 2,086.35 crore.

The state governments are entitled to receive a royalty of 14 percent on the sale price of coal, a contribution of 30 percent towards the proposed District Mineral Foundation (DMF) aimed at aiding individuals affected by various projects, and two percent of NMET from dry fuel produced by coal companies and the private sector.

In the case of captive or commercial mines, the state is also entitled to receive the revenue share offered by the auction holder in a transparent bidding process. Aside from this, states also enjoy numerous other economic advantages, such as increased employment, compensation for land, and increased investment in associated infrastructure like railways, roads, and numerous others. In the current financial year, Coal India intends to generate 838 metric tons of coal.