Centre plans to auction six coking coal mines
The Centre plans to auction six coking coal blocks, a move that may help in augmenting the supply of the fuel used for steel-making, to cater to growing demand.
"The Coal Ministry will put on offer six coking coal blocks for captive purposes," an official privy to the development said.
The entire demand of metallurgical coal, he said, is not met indigenously as the supply of high quality coking coal in the country is limited.
Thus, no option is left other than importing of such fuel.
Coal India Ltd (CIL) which produced 55.22 million tonnes (MT) of coking coal last fiscal is eyeing 59.77 MT of metallurgical coal in the ongoing financial year, the official added.
CIL, which accounts for over 80 per cent of the domestic coal production, eyes 63.55 MT coking coal in the next fiscal and 72.30 MT in 2019-20.
As per the current import policy, coal is kept under the Open General License (OGL) and consumers are free to import coal from the source of their choice as per their contractual prices on payment of applicable duty.
In the April-January period of FY'17, the country imported 34.84 MT metallurgical coal. In FY'16, India imported 43.51 MT of coking coal and 43.71 MT of fuel used in steel-making in FY'15. The government had earlier said that efforts were being made to increase the availability of indigenous coking coal in the country in order to reduce the import of the fossil fuel which is mainly used in production of steel.
Industry body Assocham had also earlier stated that India needs to emphasise on indigenous production of coking coal in order to reduce the dry fuel import which has resulted in loss of forex reserves.
Meanwhile, CIL is also planning to acquire coking coal mines in Australia as it looks to supplement the requirement of country's metallurgical coal.
Australia has put on offer some coking coal blocks and CIL has initiated dialogues with the Australian government with regard to acquiring some mines there, a source privy to the development had recently said.
However, the discussions are in a very preliminary stage, the source had said.
India's dependence on imports is particularly heavy on coking coal which is a vital ingredient in the steel making process.
Recognising limited availability of metallurgical coal as an 'disadvantage' for Indian steel sector, the draft steel policy aims at increasing supply of domestic coking coal to cut dependence on imports by half and a production of 300 million tonnes of the alloy by 2030-31.