Indian Coal Sector: Year End Review 2025
Coal is the mainstay of energy contributing more than 55% to India’s primary commercial energy.
In total power generation, coal-fired power generation accounts for about 72%, and coal will remain an indispensable pillar of India’s energy security, along with steady advances in its clean energy transition as the coal provides reliable base load power, supports critical industries such as steel & cement and plays a vital role in sustained economic growth and national development. The coal demand is expected to increase to about 1.5 Billion Tonne by 2030.
Coal Production
The coal production for 2024-25 increased by 4.98% over previous year to 1047.523 Million Tonne in comparison to 997.826 MT in the year 2023-24.
Coal Import
With increased domestic coal production, the coal imports in the country during 2024-25 fell by 7.9%, totalling 243.62 million tonnes (MT), compared to 264.58 MT in the same period of previous fiscal year. This reduction resulted in foreign exchange savings of approximately $7.93 billion (₹60681.67 crore).
Coal Allocation
During Calendar Year 2025, two tranches (VIIIth ) & (IXth) were held under the NRS e-auction in which 9.97 MT & 12.03 MT respectively were booked against the total offered quantity of 51.77 MT & 74.10 MT respectively.
Two tranches under SHAKTI B (VIII-A), were conducted by Coal India Limited for coal Linkage Auction from March to December, 2025. Out of the total offered quantity of 61.29 MT of coal, 26.47 MT of coal have been booked by successful bidders.
Coal Exchange
The setting up of the Coal Exchanges would create an independent market place, where sellers and buyers can transact coal through a transparent, competitive & efficient price discovery mechanism. This required necessary amendment in the Mines and Minerals (Development and Regulation) Act, which has been completed.
The Amended MMDR Act, 2025 provides the definition of ‘mineral exchange’ and further inserted a new section 18B in MMDR Act, 1957 to empower the Central Government to promote development of market, including trading, of minerals, its concentrate or its processed forms (including metals) through mineral exchanges. The provisions of the Act have come into force on 01.09.2025.
Coal Gasification
The Government has undertaken several policy, regulatory, and financial measures to accelerate coal/lignite gasification under the National Coal Gasification Mission, which targets 100 MT of coal gasification by 2030.
The Coal Gasification Plant Development and Production Agreement (CGPDPA) was executed between the Ministry of Coal and the selected applicants under Category I & III on 12.03.2025 and for Category II on 08.05.2025. The projects are currently under implementation, with commissioning targeted by FY 2030.
Coking Coal
Domestic raw Coking Coal production is likely to reach 140 MT by 2030. The total domestic raw coking coal production during the financial year 2024-25 is 59.6 million tonnes (MT). The domestic raw coking coal production target for the financial year 2025-26 is 83 MT.
Coal Washeries
CIL has planned for setting up of 8 coking coal washeries having capacity 21.5 MTY by FY 2030. In addition, CIL has planned setting up of 7 Non-Coking coal washeries having capacity of ~58 MTY by FY2032 to enhance non-coking coal washery capacity to 79 MTY.