New Delhi, Jun 20 (IANS): The Jharkhand government has moved the Supreme Court to challenge the central government decision to auction coal blocks for commercial mining in the country.

Prime Minister Narendra Modi on Thursday launched the auction of 41 coal blocks through a videoconference. The two-stage e-auction will help allocate mines to the successful bidders.

The state's plea, filed through advocate Tapesh Kumar Singh, contended that the Covid-19 pandemic had resulted in a negative global investment climate, and it will act as a deterrent to getting reasonable returns from energy-rich natural resources through auctions for commercial coal mining.

The plea contends that auctioning would also have an adverse effect on the tribal populace in the mining areas.

"The need for fair assessment of social and environmental impact on the huge tribal population and vast tracts of forest lands of the state and its residents are likely to be adversely affected," the state averred.

The plea contended that the decision to auction is not correct, as there was no law to guide mining activities. The Mineral Laws (Amendment) Act, 2020 creates a "legal vacuum" after it lapsed on May 14.

"... whether such a policy flip-flop on a strategically and economically important ingredient of energy basket of the country, that too within such a short span of time, will boost investors confidence especially when, post Covid 19 scenario, countries are looking away from China and towards India?" the state government plea added.

The plea contends that Section 11 (A)(1) of the Mines and Minerals (Development and Regulation) Act, 1957 allowed participation in competitive bidding for domestic companies, but restricted participation of global firms. On June 11, this condition was removed by an ordinance.

Both domestic and global firms can now participate in the auctioning of the 41 coal blocks.