India's Coal Ministry Focus on Advance Contracts for Coking Coal

The Indian coal ministry disfavors going in for overseas asset acquisition by Coal India Limited (CIL), as was been planned earlier.

State-owned behemoth CIL will now prioritize getting into advance agreements for coking coal imports, instead of directly buying coal mines, while scouting for stakes in coking coal assets only.

The decision is aimed to protect outflows of foreign exchange, which was INR 2.71 trillion last year, during which time India had imported 235 million tonnes (MT) of coal; 50 MT of it was coking coal.

"As of now the thinking is to not acquire assets but only freeze orders in advance to get coal at competitive prices," said Union Minister Pralhad Joshi on Wednesday, at the inauguration of the 8th Asian Mining Congress and International Mining Exhibition, which are being concurrently organized by the Mining, Geological and Metallurgical Institute of India (MGMI) in Kolkata.

He added that his intention and goal is clear, saying "we want domestic coal production".

Notably, Joshi had already advanced CIL's one billion tonne coal production target by two years to FY 2024.

India Will Remain Dependent on Coal: Minister

According to Pralhad Joshi, coal will remain the predominant energy source in foreseeable future for most of the global countries, including India.

Simultaneously, however, sincere efforts are being made to develop cutting-edge technologies for more efficient exploitation of hydroelectric, nuclear, solar, wind and other renewable energy sources as they are low carbon alternatives.

Up until now, coal is the backbone of India's energy security and contributes to nearly 60% electricity generation. Coal production and utilization is anticipated to grow almost threefold in the next couple of decades. Accordingly, the mining industry has to overcome the challenge of improved coal production in ways that produce minimum possible environmental impact.

Heightened coal production is needed to reach the "affordable electricity for all" initiative of the Hon'ble Prime Minister of India. Even for broader economic security, the location-specificity, intermittency and low-load factors of renewable plants mean existence of coal will continue in the near-future.

The versatility of coal ensures that continued extraction is necessary for industrial development of various sectors in addition to power utility, for instance steel manufacturing.

Coal Minister Emphasizes on Green Mining Technologies

Praising the organizers for selecting the theme "Green Mining: The Way Forward", Prahlad Joshi stated "In today's fast pace of technological advancement, energy sustenance and environment conservation are major concerns not only for developing countries but also for under-developed and developed countries."

He further stated that India as a responsible nation is committed to global sustainability objectives put forth by the United Nations and has shown leadership for the Paris Agreement and International Solar Alliance.

Joshi also drew attention towards the National Mineral Policy 2019, approved by the Union Cabinet, chaired by Hon'ble Prime Minister Narendra Modi. The policy ensures more effective regulation that will lead to sustainable mining sector development in future.