State-owned major coal mining and producing company, Coal India contributed Rs 60,140.31 crore to the exchequer in the financial year 2023-24, up 6.4% from the previous fiscal, according to the latest data available by the coal ministry.
The amount paid to the central and state governments includes royalties, GST, cess on coal, and other levies. Coal production generates substantial revenue for both central and state governments, with royalty collections from CIL reaching Rs 16,066.69 crore in FY24, compared to Rs 15,401.30 crore in FY23.
Additionally, contributions to the District Mineral Fund (DMF) and National Mineral Exploration Trust (NMET) – additional royalties under the Mines and Minerals (Development and Regulation) Act – further bolstered government finances in FY24. During the period, CIL paid Rs 4,817.55 crores to the central exchequer for the development of coal producing districts, up by 6.22% from FY23. Moreover, Rs 326.51 crore has been collected for NMET and Rs 4,605.87 crore as the Goods and Service Tax.
State governments of the coal mining regions are entitled to receive 14% of royalty on sale price of coal, DMF at 30% of royalty, and 2% of NMET from the coal produced by the companies and also the private sector.
In case of a captive or commercial mine, state governments are also entitled to receive revenue share offered by the auction holder during the bidding process of coal blocks.
Chhattisgarh, Jharkhand, and Odisha were the top states Coal India made significant contributions to. Jharkhand leads with a total revenue of Rs 13,268.55 crore from CIL, followed by Odisha at Rs 12,836.20 crore, and Chhattisgarh with a revenue of Rs 11,890.79 crore. Other states include Madhya Pradesh, Maharashtra, Uttar Pradesh, West Bengal, and Assam.
Coal producing states earned Rs 1.52 trillion during 2014-2023 from royalty, DMF, and NMET, as per latest government data. The compounded annual growth rate (CAGR) of the revenue from coal mining during the period stood at 13.80%.
“The focus of the central government for enhancing coal production to meet the growing economy has directly helped the state governments in realisation of additional revenue, which in turn has infused capital expenditure in the coal producing regions thereby bringing in development, both in infrastructure and social sector,” the government had earlier said.
Coal India had set a capex target of Rs 16,500 crore for the financial year 2023-24 and is likely to exceed the target, the government had earlier said in a statement. The coal ministry’s capex target for FY24 was Rs 21,030 crore.