India’s rising coal demand: good or bad?
COAL & MINING

India’s rising coal demand: good or bad?

Home to 1,303 mines, India is the second-largest coal producer in the world. The all-India coal production in 2021-22 was 716.08 million tonne with the production increasing by 6.74 per cent  (7.4 million tonne) during December 2021 as compared to the production in 2019 around the same period.

The scenario of the coal industry today

The coal industry has been enjoying the benefits of national reforms and encouraging policies introduced in 2020 which have been driving its growth, including the announcement of opening up the mining sector for privatisation. The accelerated growth in infrastructure and transportation sectors has also given a boost to the coal industry, which is still the backbone of India’s power sector. What’s more, industry progress indicates that demand for coal will not be abating any time soon.

The Russia-Ukraine war disrupted India’s supply of international coal, among many other things, creating a rift in the supply-demand equation. An added demand driver has been the ever increasingly hot summers spurred on by the impending Climate Crisis, which has driven up the usage of electricity nationwide, and the nation’s coal consumption, as a result, sending it almost to the brink of a coal shortage. The Central and State Governments have all been invested in mitigating the situation, resorting to power shedding and recently, prioritising the passage of coal-carrying trains over commuter trains.

The impact of the current scenario

The infrastructure sector, which had first taken a hit due to the pandemic and then due to the domino effect of price rise, stands to feel the brunt of this shortage of coal and hence, the shortage of electricity on its bottom lines as well.

Factors like the Russia-Ukraine war and the dearth of supply mechanisms for coal are short-termed and expected to get resolved soon. However, one question seems to have been echoing across all business verticals: What does it mean for India’s independence and energy security to be so reliant on a single source of fuel?

On the horizon

India continues to remain strongly adamant about reaching its net-zero targets while also simultaneously bolstering its coal supply to keep itself running. However, the future is less sooty than the current scenario might lead us to believe.

In a step to introduce sustainability in coal mining, the Ministry of Coal has created a Sustainable Development Cell to prioritise and promote the adoption of environmentally conscious management practices in coal mines. Efforts continue being made to make solar cheaper and reliable — not just during the day when the sun is out but also at night when there is no solar supply — so as to successfully surpass the popularity of and thus, the reliance on coal. Finally, private companies, in order to reach their carbon-zero goals, have been adding an extra push towards adopting renewable energy and their increasing reluctance towards using and investing in coal.

Home to 1,303 mines, India is the second-largest coal producer in the world. The all-India coal production in 2021-22 was 716.08 million tonne with the production increasing by 6.74 per cent  (7.4 million tonne) during December 2021 as compared to the production in 2019 around the same period. The scenario of the coal industry today The coal industry has been enjoying the benefits of national reforms and encouraging policies introduced in 2020 which have been driving its growth, including the announcement of opening up the mining sector for privatisation. The accelerated growth in infrastructure and transportation sectors has also given a boost to the coal industry, which is still the backbone of India’s power sector. What’s more, industry progress indicates that demand for coal will not be abating any time soon. The Russia-Ukraine war disrupted India’s supply of international coal, among many other things, creating a rift in the supply-demand equation. An added demand driver has been the ever increasingly hot summers spurred on by the impending Climate Crisis, which has driven up the usage of electricity nationwide, and the nation’s coal consumption, as a result, sending it almost to the brink of a coal shortage. The Central and State Governments have all been invested in mitigating the situation, resorting to power shedding and recently, prioritising the passage of coal-carrying trains over commuter trains. The impact of the current scenario The infrastructure sector, which had first taken a hit due to the pandemic and then due to the domino effect of price rise, stands to feel the brunt of this shortage of coal and hence, the shortage of electricity on its bottom lines as well. Factors like the Russia-Ukraine war and the dearth of supply mechanisms for coal are short-termed and expected to get resolved soon. However, one question seems to have been echoing across all business verticals: What does it mean for India’s independence and energy security to be so reliant on a single source of fuel? On the horizon India continues to remain strongly adamant about reaching its net-zero targets while also simultaneously bolstering its coal supply to keep itself running. However, the future is less sooty than the current scenario might lead us to believe. In a step to introduce sustainability in coal mining, the Ministry of Coal has created a Sustainable Development Cell to prioritise and promote the adoption of environmentally conscious management practices in coal mines. Efforts continue being made to make solar cheaper and reliable — not just during the day when the sun is out but also at night when there is no solar supply — so as to successfully surpass the popularity of and thus, the reliance on coal. Finally, private companies, in order to reach their carbon-zero goals, have been adding an extra push towards adopting renewable energy and their increasing reluctance towards using and investing in coal.

Next Story
Infrastructure Transport

Cabinet Approves Key Highway and Rail Projects in Bihar Region

The Union Cabinet on Wednesday approved the four-laning of the 84.2-km Mokama-Munger section of the Buxar-Bhagalpur high-speed corridor, a key industrial region in poll-bound Bihar. The Cabinet also sanctioned the doubling of the 177-km Bhagalpur-Dumka-Rampurhat railway line, which passes through Bihar, Jharkhand, and West Bengal, at a cost of Rs 31.7 billion.The Rs 44.5 billion highway project will be constructed under the hybrid annuity model, a variant of public-private partnership. The Mokama-Munger stretch was the only remaining two-lane section of the 363-km Buxar-Bhagalpur corridor. Fou..

Next Story
Infrastructure Transport

NGT Issues Notice on Bengaluru Twin Tunnel Project

The National Green Tribunal (NGT) on Wednesday issued notices in response to a petition filed by Bengaluru Praja Vedike and others, challenging the Bengaluru twin tunnel road project. Petitioners claim the project was “hastily announced” and bypassed mandatory environmental impact assessment procedures.Notices have been served to the Karnataka Government, Greater Bengaluru Authority, State Environment Impact Assessment Authority (SEIAA), Bengaluru Smart Infrastructure Ltd (B-SMILE), the Union Ministry of Environment, Forest and Climate Change, and project consultants.The 16.74-km twin-tube..

Next Story
Real Estate

India’s Residential Sales to Dip Slightly in FY26

Residential sales in India’s seven major cities are projected to decline by up to 3 per cent year-on-year in FY26 to 620–640 million square feet (msf), amid a moderation in sales velocity, according to ratings agency Icra.In FY25, sales stood at 643 msf, down 8 per cent YoY, following a sharp contraction in new launches and moderated demand in the affordable and mid-income segments. This slowdown came after the sector posted a robust compound annual growth rate of 26 per cent in area sales between FY22 and FY24.Icra noted: “Having seen a strong upcycle, the sector entered an equilibrium ..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement

Talk to us?