Coal import by power sector for blending sees sharp decline of 19.5% in Apr-Oct period

New Delhi: India’s coal imports for blending by thermal power plants (TPPs) saw a sharp decline of 19.5 percent year-on-year between April and October 2024 despite a growth of 3.87 percent in coal-based power generation. In a statement, the Ministry of Coal said on Tuesday, “This decline is a testament to India’s determined efforts to achieve greater self-sufficiency in coal production and reduce dependence on imports.”

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The decline assumes significance since India has been struggling to meet the power sector's demand for coal. Since the economy opened after the COVID-19 pandemic, India's power demand has see an unprecedented rise every year. Since most of the power consumed in India comes from coal, the rise in power demand had put a lot of pressure on the coal mining industry to ramp up production quickly. To make coal available for power generation, the government had mandated power generating companies to import coal for blending purpose. With a sustained increase in coal production over the last four years, the quantum of coal imports for blending has progressively gone down. In H1 of FY2024-25, coal imports by the power sector for the purpose of blending was already down by 8.5 percent y-o-y.

The overall coal imports have declined by 3.1 percent during this seven-month period, totaling 149.39 Million Tonnes (MT) compared to 154.17 MT during the same period in the previous year.

However, coal imports by imported coal-based power plants (designed to use only imported coal), has increased significantly, rising by 38.4 percent to 30.04 MT, up from 21.71 MT in the previous year.

Coal imports by NRS declines 8.8% in April-October 2024 period

The Non-Regulated Sector (excluding power sector) saw a substantial decline in coal imports, with imports dropping by 8.8 percent year-on-year. “India’s coal sector plays a critical role in supporting its rapidly growing economy. However, the country faces a significant gap in meeting its coal demand from domestic reserves, particularly for coking coal and high-grade thermal coal, which are not adequately available. As a result, coal imports are essential to support critical industries such as steel production,” said the Coal Ministry.

On the production side, coal output saw a positive growth of 6.04 percent, rising to 537.57 MT in the April-October 2024 period, up from 506.93 MT in the same period of FY 2023-24. This growth highlights the government’s concerted efforts to enhance coal production and optimise its usage within the country.

“The Ministry of Coal continues to implement a range of strategic measures to boost domestic production and ensure a stable coal supply. These efforts aim not only to reduce India’s dependence on coal imports but also to fortify the country’s energy security. By focusing on increasing domestic output, the government is working towards a more self-sufficient and sustainable energy landscape for India,” said the ministry.

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