Junior Minister for Coal Santosh Bagrodia told Parliament the government proposes changing the present policy of leasing lignite and coal blocks.

"In order to make the policy for leasing of lignite and coal blocks more transparent and objective in the context of increasing number of applications and declining number of blocks, the government is contemplating to introduce a system of auctioning through competitive bidding for allocation of such blocks by making amendment in the mines and minerals (development and regulation) act," he said in a statement.

He said that under the existing provisions of the act, prior approval of the central government is necessary before the state government can grant a mining lease for coal, lignite and other minerals included in the first schedule of the act.

"It is proposed to transfer the entire resources raised through competitive bidding process to the concerned state government where the coal block is located," he said.