Construction Industry News
Coal India Ltd, the world's largest miner, plans to export its output directly to neighboring countries, according to sources and documents seen by Reuters, after decades of supplying exclusively to domestic consumers.
The state-owned company plans to export to Bangladesh, Nepal and Bhutan, under a draft policy sent to the secretary of the Indian Ministry of Coal and reviewed by Reuters, as part of India's "neighbourhood first" policy, which aims to has to counteract China's growing growth. economic influence in South Asia.
The proposal was presented at an internal board meeting on business strategy in October 2020 and was confirmed this week by the chairman of Coal India to Reuters, although a critical coal shortage in India now means the first such shipments until the end of this year are unlikely.
"If it hadn't been for the energy crisis, we would ideally have wanted to start exporting this fiscal year (end of March 2022)," Pramod Agrawal, chairman of Coal India, told Reuters.
According to the proposal, "3% of Coal India's annual production will be earmarked separately for export", with a particular focus on boosting long-term bulk trade.
Export pressures are seen as a longer-term linchpin that would help Coal India diversify its revenue streams and boost pressure from New Delhi to strengthen ties with strategically important neighbours.
However, the proposal has recently been overshadowed by India's own coal shortage at home, meaning the first shipments are unlikely until the end of 2022, according to Agrawal.
India - which relies on coal for nearly three quarters of its electricity supply - has yet to fully recover from the crisis that forced power cuts lasting up to 14 hours a day in some northern states.
In addition to these woes, international coal prices have soared due to a surprising temporary export ban by top exporter Indonesia and major purchases from European buyers fearing a Russian invasion of Ukraine could cut off gas flows to Europe.
Coal India, which produces 80% of India's coal, aims to increase production to 1 billion tons by 2024.
Coal India has previously exported small quantities to neighboring countries on an ad hoc basis, but never in commercial bulk.
Last year, Coal India also allowed domestic customers to export e-auction coal from the miner for the first time.
