India Likely to Stop Coal Imports by 2023-24

The Union Minister of Coal and Mines, Pralhad Joshi, recently announced India’s plans to stop the import of thermal coal from 2023-2024.

Coal-based power makes up the largest share of power generation in India. However, considering that India has the 5th largest coal reserves in the world, stopping imports is not significant news on its own.

The announcement was made during a two-day brainstorming session organized to come up with a road map for the coal sector in India. The Minister noted that the session was used to think of out-of-the-box solutions to overcome the various bottlenecks of the sector. Ways to achieve the country’s one billion tons of coal production by Coal India Limited (CIL) by FY 2023-24 were also discussed during the session.

Joshi also said that diversifying the coal sector to integrate solar energy generation into the mix would be a good idea. He also proposed a 5 GW solar power target for CIL by FY 2023-24 and that it could diversify into coal gasification with a target of 50 million tons by 2030 to enable a more sustainable energy mix for the country.


These moves could indicate that renewable energy generation is picking up pace in the country. The share of renewable energy has been growing, and it is only a matter of time before it overtakes traditional fossil fuel-based energy.

Separately, the Minister also urged coal companies to place more emphasis on the safety of their coal mine workers and asked them to achieve zero mortality by FY 2023-24.

Previously, Mercom reported that India’s total installed power capacity stood at about 371 GW as of December 31, 2019. Of this, renewables (including large hydro) accounted for about 133.2 GW, up from 122.8 GW last year, an 8.5% rise. Coal power installations still held the top spot with cumulative coal installations at around 198.5 GW or 53.5% of the total mix.

Thermal power, which includes coal, lignite, gas, and diesel, maintained its stronghold and continued to be the most significant contributor to the country’s power pool. Its cumulative installations rose to 230.7 GW by the end of December 2019, up from 223 GW last year. However, its overall share fell to 62.24% from 63.2% last year, highlighting the progress made by renewable energy capacity additions.

Meanwhile, Prime Minister Narendra Modi’s office recently proposed waiving the Goods and Services Tax (GST) Compensation Cess, (earlier called the Clean Energy Cess which was India’s version of carbon tax) on coal to reduce the financial strain on distribution companies, besides helping the thermal power projects install flue gas desulphurization to curb pollution. This proposal comes amid the mandate to implement flue gas desulphurization at thermal power projects in the country. The resulting investment in the FGD process is expected to result in increased power prices for customers. FGD is the process of removing sulfur dioxide from exhaust flue gases of fossil-fuel power plants, and sulfur oxide emissions from processes like the incineration of waste material.