The Cabinet Committee on Economic Affairs (CCEA) would decide on clearing the draft coal regulatory authority bill in a month as the bill received the approval of the Group of Ministers (GoM).
The GoM, in its latest meeting, cleared the formation of an independent coal regulatory authority to monitor the sector.
The draft bill will bring state-owned monopoly miner Coal India, which accounts for 81 percent of Indian coal production, in the regulatory framework.
The draft bill gives some role for the proposed regulatory authority in deciding the price of the coal mined in the country.
At the GoM meeting, ministers also discussed ways to help power producers recover additional cost of expensive imported coal from distribution companies.
Officials from of coal and power ministries will jointly suggest the framework for passing on fuel costs to customers.
The government decided to set up a regulator in order to streamline the allocation of coal blocks after it came under attack for non-transparent methods of allocating the scarce natural resource.