India Set To Be Top Indonesia Coal Importer: ASSOC.

India will surpass Japan to become the leading buyer of Indonesian coal this year, taking as much as 60 million tonnes to help meet feed India's burgeoning power demand, the Indonesian Coal Mining Association said on Monday.

India will import 5 million tonnes more coal from Indonesia in 2011 compared to last year, with the total number set to jump to 90 million tones by 2013, Bob Kamandanu , chairman of the association told Reuters.

"In the past, Japan has traditionally been the leader of importing Indonesian coal, but now India is surpassing it," said Kamandanu, speaking on the sidelines of the Coaltrans Asia conference. "In terms of tonnage, India is moving towards 50-60 million tonnes... very strong.

"There is a lot of new IPPs (independent power producers) onboard," he added. "It could go up to 90 million tones (in 2013) for India."

Electricity demand in India, Asia's third-largest economy, is expected to rise 56 percent to 1,400 billion kwh by the fiscal year ending in March 2017.

Kamandanu added that India has been able to access such large amounts of Indonesian coal through long-lasting relationships with existing Indonesian producers, which are ramping up output.

"Of course also from the acquisition of the assets," he said. "A lot of Indian investors (are) acquiring the assets."

Most Indonesia coal is mined in East Kalimantan, Central Kalimantan, South Kalimantan and South Sumatra.

Although Indonesia's coal is largely sub-bituminous material with a lower heating value compared with standard Australian grades, Chinese and Indian utilities have been snapping up more and more of its exports to help sate booming domestic demand.

He said that Japan, which suffered a devastating earthquake in March this year, would import around 57 million to 58 million tonnes of Indonesian coal this year, down from previous year's highs at around 65 million tonnes and unchanged from 2010.

Source : economictimes.indiatimes.com