Recent data reveals a promising trend in India’s coal sector, with a noticeable reduction in the share of coal imports in the country’s total coal consumption. From April 2023 to January 2024, the share of coal import dropped to 21%, down from 22.48% during the corresponding period in the previous year. This shift reflects a growing reliance on domestic coal sources, marking a positive development for the nation’s energy security.
One significant aspect of this trend is the remarkable decline in the volume of coal imported for blending by thermal power plants, plummeting by 36.69% to 19.36 million tons (MT) during the aforementioned period. This reduction underscores a strategic pivot towards utilizing domestic coal resources, thereby reducing dependence on imports.
Conversely, there has been a notable surge of 94.21% in coal imports by imported coal-based power plants during the same timeframe, attributed to a substantial decline in import prices. These power plants, designed to operate on imported coal, experienced a boost due to a sharp drop in coal prices from key suppliers like South Africa and Indonesia. Prices from these countries decreased by approximately 54% and 38%, respectively, during April 2023 to January 2024, compared to the corresponding period in the previous year.
The data also highlights a significant shift in the auction dynamics of Coal India Limited (CIL), the largest coal producer in India. The auction premium received by CIL, over the notified price of coal, witnessed a remarkable reduction from 278% in the fiscal year 2022-23 to 82% during the same period in 2023-24. This decline in auction premium signals the ample availability of coal in the market, with coal companies currently holding a substantial stockpile of 96 MT.
The overall trajectory suggests a positive momentum towards greater self-sufficiency in coal production and consumption, aligning with the government’s vision of reducing import dependency and bolstering domestic coal reserves. As India continues its march towards energy security and sustainability, the coal sector’s evolving dynamics promise a resilient and robust foundation for the nation’s growth trajectory.