India, the largest importer of metallurgical coal in the world since 2018 overtaking China and Japan, is set to import an additional 100 million mt (metric tonnes) by 2030, thanks to the big infrastructure push in the country.

Apart from various mega infra initiatives like roads and ports, the country is set to raise its steel capacity to 300 million mt per year by 2030, up 71% from 2023, and that will be a major trigger for continued imports of the key raw material in steel production, according to estimates by S&P Global Commodity Insights. About 35-40% of steel demand comes from the building and construction sector and another 25-30% is from other infrastructure projects. About 770 kilograms of met coke is required to produce one tonne of steel. India's steel capacity is set to reach 200 million mt by 2025.

Since 2017, India has imported more than 400 million mt of seaborne met coal, 23% more than China and 14% more than Japan. The top four suppliers are Russia, Mozambique and South Africa, the US and Australia. India's total met coal demand is expected to rise from the current 150 million mt to over 250 million mt by 2030, says S&P.

In 2021, India launched 'Mission Coking Coal' action plans to reduce import dependency to produce 140 million mt by 2030, an increase of 169% from 2022. According to the annual review data of the Ministry of Coal in December 2023, Coal India plans to increase raw coking coal production from existing mines up to 26 MT and has identified ten new mines with about 22 MT Peak Rated Capacity (PRC) by FY 2025.

To further enhance raw coking coal production, the Ministry of Coal has auctioned 16 coking coal blocks to the private sector with a PRC of 25 MT during the last two years. Most of these blocks are expected to start production by 2025.

At present, domestic raw coking coal washing capacity is about 23 MT per annum including 9.26 MT in the private sector. Coal India is planning to set up nine more new washeries with a capacity of 26.5 MTPA. With this, CIL will be able to supply about 15 MT of washed coking coal to the steel sector, thereby reducing the import of coking coal. During FY 23, CIL supplied 2.15 MT of washed coking coal to the steel sector and set a target of 3.45 MT during FY24, according to the government data.

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