According to the latest reports from industry sources, India, the second-largest thermal coal importer after China, is now inclined to reduce its power plant imports by 30% in the following year. India’s government is aggressively aiming to reduce coal imports by 15 million tons this year. However, South Asian countries still depend on coal for about three-fourths of their electricity production. In 2025, India imported almost 50 million tons of coal from countries such as Indonesia, South Africa, and Russia.
New Delhi aims to reduce dependence on imported coal, which accounts for about 17 gigawatts of power supply, and to increase domestic output from private miners. This move will ultimately replace at least 20% of imported coal with local supply. As of December, imported coal thermal power was used to generate around 91.3 gigawatts of power, accounting for 40% of its total coal-related power capacity. Coal India Limited has been facing a crisis due to a huge inventory of 90 million tons after producing 781.1 million tons in the fiscal year ending March 2025. To reduce such inventory, Coal India has opened the doors for exports to Bangladesh, Bhutan, and Sri Lanka.
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Rajiv Ramnarayan, chief executive of Singapore-based coal trader Equentia Natural Resources, has claimed that, apart from strategies to increase coal-fired capacity from 97 gigawatt to 307 gigawatt, India’s thermal coal imports are expected to slow because new plants will be constructed closer to domestic sources. Followed by Vasudev Pamnani, a coal trader and director at iEnergy Natural Resources, expects a dynamic shift in thermal coal from the power sector to non-power industries like cement and sponge iron, which will offset a decline driven by domestic supply.
