Prime Minister Narendra Modi faced down the first major opposition to his economic agenda as coal unions called off a 2-day-old strike that threatened to paralyze the nation.

The unions at the world's biggest coal miner, Coal India Ltd., agreed to end the planned five-day action late Wednesday after a seven-hour meeting with Coal and Power Minister Piyush Goyal in New Delhi.

The government will establish a committee with labor representatives on it to look into the unions' demands, Goyal said. Concerns about a potential privatization of Coal India were "unfounded," he said.