India Targets 30 Percent Reduction in Coal Imports for Power Sector in 2024: Report

India Aims to Cut Thermal Coal Imports by 30%

Key Figures:

• 50 million tons: India's thermal coal imports in 2025
• 15 million tons: Target reduction in thermal coal imports this year
• 17 GW: India's power plants built to run on imported coal
• 90 million tons: Coal India's inventories as of December 31
• 781.1 million tons: Coal India's record production in the fiscal year to March 2025
• 80%: Coal India's contribution to India's total coal output last fiscal year
• 6.2%: Decline in India's thermal coal imports in 2025
• 97 GW: Increase in coal-fired capacity to 307 GW by 2034-2035

Background:

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India, the world's second-largest importer of thermal coal, aims to reduce its reliance on imports by at least 30% for power plants. This comes as the country still relies on coal for three-fourths of its electricity generation, despite ramping up renewable energy towards its 2070 net-zero goal.

Action Plan:

The government plans to replace at least 20% of imported coal with domestic supply at most plants, with some able to go up to 30%. Authorities aim to cut thermal coal imports by at least 15 million tons this year, reducing the total from nearly 50 million tons in 2025.

Industry Reaction:

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Coal India has been struggling with inventories of around 90 million tons as of December 31, after producing a record 781.1 million tons in the fiscal year to March 2025. To pare stockpiles, Coal India has opened up exports to Bangladesh, Bhutan, and Sri Lanka.

Market Impact:

India's thermal coal imports are expected to slow gradually as newer coal plants are likely to come up in areas closer to domestic sources. The share of imported thermal coal is expected to gradually shift from the power sector to non-power industries such as cement and sponge iron.