Sources claim that India wants to reduce coal imports for the power sector by 30% in this year.
India, which is the second largest thermal coal importer in the world, wants to reduce its imports by at least 30 percent. It has asked the industry to experiment with blending more domestic 'coal' with imported coal.
India's power stations will import nearly 50 million tonnes of coal from countries such as Indonesia, South Africa and Russia by 2025. Two government officials and an industry source said that the government wants to reduce this number by at least 15 millions tons this year.
Even though it is accelerating its transition to renewable energy at an unprecedented pace, the South Asian nation still relies on coal as a source of electricity for three-fourths.
New Delhi is looking to reduce its reliance on coal imports to power the nearly 17 gigawatts worth of power plants in India.
Sources from the government and energy companies said that authorities aim to replace?imported coke with domestic coal at most plants. Some may be able to reach up to 30%.
Seven people who spoke with us did not wish to be identified as they had not been given the authority to speak to media.
The Indian coal and power ministry has not responded to any emails asking for comments.
The government has been trying to reduce coal imports in the power sector for a long time, but these efforts have failed because power plants are unable to burn local coal of lower quality.
A power plant executive in the western state of Gujarat said that power plants will not be able use as much coal as government wants unless they completely recalibrate their boilers. This would be expensive and require subsidies from the state.
One of those involved in the testing stated that the government assured power producers of the high quality of coal supplied domestically.
Coal India is struggling to manage its 90 million-ton inventory as of December 31. This comes after the company produced a record 781 million tons of coal in the fiscal year ending March 2025. This accounted for nearly 80% the total coal production in India last fiscal year.
Coal India has opened up its exports to Bangladesh Bhutan and Sri Lanka in order to reduce?stockpiles.
India's thermal imports of coal, which are second only to China in the world, dropped 6.2% between 2025 and 2021 as power demand fell in warmer weather.
India's thermal coal imports will likely slow down as new coal plants are built in areas that are closer to the domestic coal sources. This is according to Rajiv Ramnarayan of Singapore-based coal trader Equentia Natural Resources.
According to Vasudev Pamanani, director of iEnergy Natural Resources - a coal trader - the share of thermal 'coal imported from abroad will gradually shift away from power industries and towards non-power ones such as sponge iron and cement.
Pamnani stated that "imports of coal with lower and middle calorific values are expected to decrease gradually. This will be offset by the domestic supply. Imports would only be made for industries that require specific qualities or higher grade coal." Sethuraman NR, Mayank Bhardwaj, and Sonali Paul edited the article.
(source: Reuters)
