Underground Coal Mining in India: Benefits, Trends & Government Measures

Context: information was given by Union Minister of Coal and Mines Shri G. Kishan Reddy in a written reply in Lok Sabha. 

Key Benefits of Underground Coal Mining

A. Environmental Benefits

• Minimal surface disturbance:

  • Protects agricultural land, forests, and habitation.

• Reduced dust and noise pollution compared to opencast mining.

• Smaller surface footprint leads to:

  • Lower indirect greenhouse gas emissions.

  • Less land degradation and vegetation loss.

B. Resource Efficiency

• Access to deep-seated coal reserves, often higher in quality.

• Maximizes coal extraction from difficult terrains.

C. Climatic and Operational Stability

• Less vulnerable to adverse weather (e.g., floods, heavy rain).

• Ensures year-round mining continuity and safety.

Policy Support and Incentives 

To promote UG mining, the Government has amended auction rules:

Incentives under amended methodology (dated 23.04.2025):

• Reduced floor revenue share: From regular rates to 2%.

• Complete waiver of Upfront Amount for bidders.

• Restriction on mine conversion:

  • Mines allocated as UG cannot be converted to opencast or mixed mode during the mine’s life.

Applicable to:

• Bidders for underground coal/lignite mines under revenue-sharing auction mode.

Production Share of Underground Mining (% of Total Coal Production)

Measures by Coal Companies to Enhance UG Mining

• Adoption of Mass Production Technologies:

  • Mechanised coal extraction, conveyor systems, longwall mining.

• Mine Development & Operation (MDO) Model:

  • Used to revive abandoned/discontinued UG mines via revenue sharing mode.

• Focus on modernization and safe operations.

Challenges in Scaling Underground Mining

• High capital and operational costs.

• Skilled manpower requirement.

• Slower production rate compared to opencast mining.

• Safety risks, although mitigated with technology.

• Declining share in national output due to preference for quicker returns via opencast methods.

Way Forward

• Balanced coal strategy: Combine economic viability with sustainability and land conservation.

• Integrate underground mining in India's Just Transition roadmap.

• Leverage clean coal technologies and carbon capture in UG operations.

• Align with India’s Net Zero 2070 goal by reducing ecological damage.