Coal Ministry permits use of insurance surety bonds as replacement for bank guarantees
The Indian Coal Ministry now permits coal block allottees to use insurance surety bonds as a substitute for performance bank guarantees. This policy change is intended to reduce the financial burden on companies and improve capital efficiency.
Why it matters
This regulatory shift aims to modernize financial compliance for the mining sector, potentially encouraging more investment in coal development.
Coal Ministry on Thursday (July 2, 2026) allowed entities-accorded coal blocks to use insurance surety bonds (ISBs) instead of performance bank guarantees (PBGs) to fulfil their obligations for performance surety.
The article reports on a government policy change neutrally, focusing on the stated economic benefits.
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