India's Coal Import Decline Amid Rising Power Demand

India's Coal Imports Decline 4.2% YoY to 213.10 Million Tonnes

Key Highlights

• India's coal imports decreased by 4.2% year-on-year to 213.10 million tonnes during April-January of FY2025-26, despite rising power demand.
• The decline in imports is a result of a structural shift in India's energy strategy, prioritizing domestic production over reliance on overseas supplies.
• Domestic coal production has increased significantly, enabling adequate supply to coal-based power plants and reducing the need for imports.

Domestic Coal Production

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• India has surpassed the milestone of 1 billion tonnes of coal output for the second consecutive year, highlighting improved coordination and efficiency across the sector.
• Coal Minister G Kishan Reddy expects domestic production to grow at a rate of 6-7% annually, reaching 1.5 billion tonnes by 2029-30.

Import Trends

• Non-coking (thermal) coal imports fell to 127.80 million tonnes during April-January, down from 141.18 million tonnes in the same period last year.
• Coking coal imports, used in steelmaking, increased to 50.39 million tonnes from 45.83 million tonnes in the year-ago period.

Global Market Factors

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• Rising global coal prices, driven by supply constraints and geopolitical tensions, have made imports less attractive.
• The broader global energy market has been volatile due to ongoing conflicts, tightening supplies, and disruptions in key export regions.

Energy Security Goals

• India's strategy focuses on boosting domestic production, improving supply chain efficiency, and reducing "non-essential" imports, particularly for the power sector.
• The government aims to build a more resilient and predictable energy ecosystem by reducing dependence on volatile global markets.