By Devanik Saha
“#India‘s #coal story: from scarcity to surplus in 2 years!” tweeted Bharatiya Janata Party (BJP) national spokesperson Shaina NC on July 30, 2016.
Although Shaina’s tweet did not refer directly to Coal India Limited (CIL), she was clearly referring to the 41-year-old state-owned company, which accounts for 80 per cent of Indian coal production.
We fact-checked Shaina’s statement and found her claim true.
CIL’s production rose by 74 million tonnes over the past two years, according to official data from Coal India, which aims to mine a billion tonnes by 2020.
CIL’s production has increased by 6.9 per cent and nine per cent in the past two years, compared to one per cent, 3.8 per cent and 2.3 per cent for the three years preceding 2014, when the Bharatiya Janata Party (BJP) came to power.
The government has set a production target of 598 million tonne for the current financial year (2016-17).
Higher coal production has resulted in a drop in imports. India imported 199.9 million tonne coal in 2015-16 against 217.8 million tonne in 2014-15.
This, however, does not convey the full picture.
Coal can be grouped under two heads — thermal coal, which is used by power plants, and coking coal, used in steel production.
India has relatively low reserves of coking coal, which will continue to be imported. Imports have fallen for thermal coal: During 2014-15, India imported 168.4 million tonnes; in the first 10 months of 2015-16, imports were 128.7 million tonnes.
The on-going monsoon season has dampened the demand for coal. At least five large power-consuming states have switched from coal-fired electricity to cheaper hydel power.
“States like Punjab, Haryana, Rajasthan, Madhya Pradesh and Maharashtra are cutting down on coal procurement, leading to low sales growth, which is around 1.3 per cent in July this year against almost nine per cent the previous year,” a senior Coal India official told The Economic Times on August 1, 2016.