Should the coal ministry's supervisory role in coal block development be done away with?

The amendment to Mines and Minerals (Development and Regulation) regulations, once notified, will bring in a regime that will allow potential coal block developers to communicate their value of a particular asset via the means of price bids, which will be used to allocate these resources to the eventual winner.

• Given the high scarcity of the dry fuel, it is very likely that the premium to be recovered from winning bidders would be very high. In such a circumstance, with so much money on the line, would the companies really exhibit negligience in executing their projects? Thus, allowing the Ministry of Coal (MoC) to issue show cause notices and deduct bank guarantees would seem superfluous. 
• A case may, thus, be made for doing away with such a supervisory role for the ministry, which can be made smaller and its role limited to research and formulating policy on the efficient exploitation of coal resources in India.
• On the other hand, an argument may be made that irrespective of the efficiency of a competitive mechanism for coal block allocation, market failures are a possibility and the MoC should retain its monitoring role to step in during any such eventualities.