India’s production of coal has risen from 70 million tonnes at the time of nationalisation of coal mines in the 1970s to over 557 million tonnes in 2012-13. The 12th Five-Year Plan (2012-2017) envisions increasing coal production to 795 million tones by 2016-17.

However, India’s largest coal miner, Coal India, which has to contribute the bulk of this growth, may not be in a position to do so. Coupled with natural calamities, such as cyclones Phailin and Helen, production and transportation of coal by Coal India is also impacted by excess heat in summer, law and order conditions, and worker strikes. A single day’s strike can hit Coal India’s production by as much as 1-1.5 million tonnes.

As a result, the miner is expected to import about 80-83 million tonnes of thermal coal in 2013-14 to fill the widening gap between total coal requirement and availability in the country.

In India, the majority of coal produced is consumed by the power sector. For example, Coal India aims to produce 492 million tonnes of the fossil fuel in 2013-14, of which 377 million tonnes is expected to be consumed by the power sector.

However, despite this huge consumption of coal, fuel supply for power generation remains a sticky issue.

Out of the 78,000 MW of power projects in queue to sign fuel supply agreements with Coal India, 70,400 MW have signed the agreements, said Coal India Chairman S. Narsing Rao.

Rao also said that if the sector demands, Coal India will also import 4-5 million tonnes of coal in 2013-14, exclusively for the power sector.

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