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Will Coal Fuel The Great Indian Economic Locomotive?

Coal industry is experiencing a slowdown all over the world. The slump in the coal industry will last longer than expected and the prices won’t improve until at least 2020, an economics professor at Central Queensland University, John Rolfe has warned. What happens to India’s coal reserves then, is the question!

India is in a peculiar position, being world’s third largest producer of coal and yet, not being able to fulfill its energy needs. This is primarily due to restricted mining marred with policy issues that have made domestic coal unviable and inaccessible.

The demand of coal in the country though, has always remained higher than its production. Coal, the most important and abundant fossil fuel in India, accounts for 55% of the country’s energy needs.

Indian power sector relies heavily on coal with about 78% of the total electricity being generated by it. But the irony is that despite there being large coal reserves lying unused in India, millions of tonnes of coal is imported every year! The reason again being bad policies and government’s inaction.

Mr. Brijesh Pant, an energy expert and an academician with JNU, says that providing electricity for 24 hours is on the government’s agenda, for which coal will have to be used. But the fact is that in areas where there have been regulatory issues, decisions on the use of coal have been pending for long. This is why thermal power plants have to import it from countries like Australia and Indonesia.

Efforts are being made that the government enables production of 1.5 billion tonnes of coal by 2020 and reduce imports of coal considerably from 2017 onwards.

But in the current scenario, Indian companies are stalling to make mines operational because it has become uneconomical, whereas imports are cheaper and easier to access.

Source: Newsworl India