PSUs to follow “zero coal imports” policy from next fiscal: Official

Kolkata: In order to bring down coal imports at a faster rate, public sector units (PSUs) in the power sector will follow "zero imports" policy from the next fiscal onwards, a top official said on Thursday.

"In the power sector, we engage with each of the public sector entities and by March 31 this (fiscal) year, there will be zero (coal) imports by all the public sector entities in the power sector, and there will be no imports thereafter," said Coal Ministry Secretary Anil Swarup.

"The objective is to bring down imports as the country increases the domestic coal production. Imports are coming down but Centre`s objective is to bring down imports at much faster rates," he said.

"This year, we should be able to reduce imports by 15 million tonnes. We have done a detailed analysis of how to handle imports and the strategy related to both power and non-power sector," Swarup said at a seminar organised by MCC Chamber of Commerce and Industry here.

"To discourage coal imports by private sector, we are increasing the amount of coal which is available through e-auction. Since, e-auction prices have come down, the coal is available at a much cheaper rate," Swarup said.

The Coal Secretary added that with the firming up of international prices, chances increase that this coal (coal available through e-auction) would be picked up.

The government has set a target to produce 1.5 billion tonnes of coal domestically by 2020.

Regarding commercial mining, he said the ministry is going in steps. The first steps have already been taken through allocations of coal mines to state governments. But in terms of offering mines to private sector for commercial purposes, he said the ministry is "working towards it".

"Ground work has been done. The problem is that because of good work done by Coal India, it does not seem to be so much demand for mines," Swarup said.

He mentioned there was a paradigm shift in the problem -- from a spell of supply shortage to a phase of demand shortage. Low generation at power plants led to a demand shortage of coal. PLF (plant load factor) at power plants stands at 59-60 per cent.

The power generation companies were generating less power because of subdued demand from distribution companies. He, however, hoped that the Uday scheme, that was floated to restructure the distribution companies, could boost the demand.

In a demand shortage scenario, the inventory benchmark for the power plants has come down to 15 days from 20-25 days and this has happened because coal is available, he said.

Swarup also said for a regulated sector like steel, the Ministry is working with them to meet their coal requirement instead of allowing them to continue imports.