Ministry of Coal Notifies Acceptance of Insurance Surety Bonds for MMDR Coal Blocks
Insurance Surety Bonds Introduced for Coal Block Allocations
The Ministry of Coal has introduced a key reform to provide greater financial flexibility to coal block allocates and further strengthen ease of doing business in the coal sector.
Through the Coal Blocks Allocation (Amendment) Rules, 2026, the Ministry has enabled the use of Insurance Surety Bonds (ISBs) in place of Performance Bank Guarantees (PBGs) for coal blocks allocated under the Mines and Minerals (Development and Regulation) Act, 1957.
The amended framework allows coal block allocates to choose between a Performance Bank Guarantee and an Insurance Surety Bond for fulfilling their performance security obligations.
The introduction of ISBs will impact the financial management and operational efficiencies of coal block allocates, which is relevant for understanding government reforms and policy changes in resource management.
