NEW DELHI: India's coal deficit is expected to double to 265 million tonnes in the next five years despite a three-fold increase in government spend on the sector.
Importing such quantity of coal even at today's prices would mean a whopping $32 billion forex bill, but it would be necessary to light up a third of the country's power capacity by 2016-17.
Large imports look unviable given the volatility in international coal market. International coal prices increased by almost 60% between October 2010 and March 2011 due to regulatory changes in exporting countries, such as Indonesia and Australia. Prices have softened a little only in the last 2-3 months due to slow down in economies.
Existing imported coal-based power project developers have asked the government to revise tariffs.
As per latest government estimates, demand for coal will grow to 980.5MT by 2016-17 as against domestic availability of 715MT. The estimated demand is about 100MT higher than projections made by Planning Commission's Integrated Energy Policy. At present, the country has a coal deficit of 137MT.
Coal output during the 12th plan is expected to grow 5.31% per annum, against 5.16% a year in 2007-12.
The deficit would grow even as the government spend on coal sector is expected to triple to Rs 1,09,824 crore during 12th plan.
Source : economictimes.indiatimes.com