Commercial coal mining is widely seen as an answer to the increasing demand-supply gap of coal in the

county allowing private commercial mining is expec

ted to increase competition
,infuse new technology and lead to a market-based price discovery.
Increase coal supply in the country therefore supply curve shifts towards right
demand would shift from inelasticity to elasticity as more competitors would give more
options to the consumer
no perfect competition
Imports wld fall down and so wld import taxes
Shift from monopoly market to oligopoly mrkt


Demand shifting from inelasticity to elasticity
No perf comp
Imports



Demand shifting from inelasticity to elasticity
Since the markets might open for pvt. Sellers the demand curve which was previously insensitive to market
fluctuations would now become sensitive to market conditions and thus shift from inelasticity to elasticity as more
competitors would bring in more demand supply fluctuations and price changes.

No perfect competiton
Perfect competition is a market condition where the government interference is non existing however even if the
government open the coal market for the pvt sellers it would retain its control on the supply curve to not allow too
much freedom to the pvt sellers either by regulations or domestic taxations .Perfect competition consist of many
producers and identical products and here in the coal market the producer remains the government and no
identical products exist thus leading to no perfect competiton.

Imports reduces and thus import taxes fall down
Coal was imported from several countries to satisfy the coal demands of the nation and if this initiation takes
place it would reduce the imports as more domestic players would come in and thus a reduction in import taxes.
The fall in import taxes would benefit the government revenue and hence enhance the economy. A slight rise in
inflation may occur due to interrelated factors however the benefits would be widespread.



New technology & leads to market based price discovery
Previously the price of the coal markets where determined by government but with this initiation the market
forces even if it means few sellers would determine the price and it would result in open fluctuations. With advent
of new players to the market the new technologies and innovations would seep in resulting in better efficiency
and faster production helping reduce cost further.