Shrinking Coal Import: Does this Lead India to a Sustainable Future or Energy Crisis?

The energy demands of India’s rising population are increasing every day due to rapid industrialization, urbanization, rise in income and standard of living, etc. This all contributed to making India 3rd largest energy-consuming nation across the globe.

In the past, this energy demand was primarily met by the Non-Coking Coal in the power plants which were imported from the international markets and drain out the foreign reserve of the country. But due to increasing coal production in the country and gradual adaption of renewable sources of energy generation such as solar, wind, hydrogen, etc with the help of policy interventions and government support coal imports are continuously showing the declining trends.

Data shows that imports of non-coking coal (All Grades)  declined by 23.33%, non-coking coal (Used for Power Generation)  by 60.87%, and other types of coal by 16.42%.

This was achieved due to the increasing production capacity of coal production mines. As per the government statistics, out of 35 top coal-producing mines in India, 14 mines have produced more than 100% of their total capacity. The shrinking coal import thus has saved India’s foreign reserves during the first quarter of 2022 when the coal prices in international markets are at their highest levels due to the Covid 19 pandemic. This all was achieved through the significant reforms and amendments of relevant acts by the Ministry of Power such as the MMDR (Amendment) Act, 2021 to make the provisions coherent with the vision of the government’s “Atmanirbhar Bharat” initiative.

Around this, India also faced a coal shortage during August- September 2021 when industries started their operation in full after the 2nd wave of Covid 19. This was the second occurrence of coal shortage after the 2016 coal crisis. The continuous monitoring of production, distribution, and storage of coal to power plants through government intervention and more push to use clean energy options have resolved the issue and paved the way for saving India to enter into such an energy crisis once and all.