India to stop thermal coal imports; save Rs 40,000 cr

Mumbai: In view of rising production of the dry fuel, India plans to completely stop thermal coal imports in 2-3 years that would result in annual savings of Rs 40,000 crore, Union Minister Piyush Goyal on Friday said.

Coking coal, however, would need to be imported, the Coal and Power Minister said at the maiden Maritime India Summit here, adding that his Ministry was ready to tie up with Indian shipping companies for this purpose.

Record coal production by the world's largest coal miner CIL, helped India reduce its import bill of the dry fuel by more than Rs 28,000 crore in the last fiscal.

"I have no hesitation in saying that Indian companies used to import a lot of thermal coal. We want to completely stop the import of thermal coal in the next two to three years. We have already reduced imports by Rs 28,000 crore. We will save Rs 40,000 crore," Goyal said.

He said his Ministry was ready to enter into pacts with Indian shipping companies for import and transportation of coal.

"This is the time for Indians to buy ships, to invest in infrastructure. This is the time for Indian shipping companies to own ships. I am happy to do long term contracts with Indian shipping companies to transport our coal. Why don?t we have a long-term contract," he said.

Goyal also proposed setting up a small private equity fund that would be handled by an international fund investor expert.

"We can have some base capital of about USD 250 million and this fund can provide equity to various organisations undertaking logistics through coastal shipping and inland waterways," he said.

"Lets look at innovative solutions," he added.

Goyal said if PSUs as well as the ministries of power, coal and others contributed to this, it will give confidence to the private sector to participate in this initiative.

"We could also raise about Rs 4,000 crore from international investors," he said.

Goyal said government is committed to ramping up Coal India Ltd's production to 1 billion tonne by 2019.

In 2015-16, the 'Maharatna' achieved a record production of 536 MT, which was 42 MT more than the previous fiscal. Its production grew by 8.5% year-on-year.

CIL, which accounts for over 80% of the domestic coal production, was however eying 550 MT in 2015-16.