Team Blitz India
NEW DELHI: India’s coal sector investment is expected to grow by almost 10 per cent year on year (YoY) to around Rs1.25-lakh crore in the current calendar year as the country prepares to meet demand due to rising electricity consumption and expanding industrial base.
According to the International Energy Agency (IEA), investments in the coal sector by the world’s second largest producer and consumer has been growing consistently since 2021 with the annual rate of growth in investments expected to double in 2024 compared to 2023.
The agency in its world energy investment report 2024 anticipates that efforts by the world’s third largest energy consumer to ramp up coal production will fall short of meeting the demand for the critical commodity with reliance on imports increasing.
Aided by an expanding industrial and commercial base, as well as growing electricity consumption, which is appreciating at about 10 per cent annually, India’s appetite for coal has risen substantially in the past decade.
The IEA pointed out that the government announced plans to increase domestic production to meet rising demand and investment, which has been growing steadily since 2021.
“Investment increased by 5 per cent in 2023 and is set to expand by nearly 10 per cent in 2024 to around $15 billion. The Ministry of Coal is relying on a series of measures to boost coal supply, including commercial auctions with a revenue share mechanism, allowances for the sale of additional coal production and rolling auctions,” it revealed.
Nonetheless, based on current trends, demand is set to rise faster than supply, which means India could soon overtake China to become the world’s largest coal importer, it added.
