Decline in coal imports in FY22 due to less buying by power sector: Govt

The government on Thursday said the drop in coal imports in FY'22 was mainly on account of the power sector's inbound shipments declining.

Coal imports that had touched 248 million tonnes (MT) in FY'20 dropped continuously during the next two financial years to 215 MT in 2020-21 and 209 MT in 2021-22.

"The decline in coal import during 2021-22 is largely due to decrease in import by Power Sector which came down from 45 MT in 2020-21 to 27 MT in 2021-22, decline of almost 40 per cent," the coal ministry said in a statement.

"The decline is more steep if we compare coal imports by power sector in 2021-22 to pre-Covid year of 2019-20 when such import was 69 MT," the ministry said.

This is despite the fact that total thermal power generation in the country increased to 1,115 billion units (BU) in 2021-22 from 1,032 BU in 2020-21, an increase of almost 8 per cent.

Despite steep rise in actual demand of coal from 956 MT in 2019-20 to 1,027 MT in 2021-22, imports of the dry fuel have not increased.

Coal imports grew at a compound annual growth rate (CAGR) of 22.86 per cent during the period 2009-10 to 2013-14. At this CAGR, coal imports would have reached 705 MT in 2020-21 and further to 866 MT in 2021-22.

The import of coal could be checked only by sustaining increased domestic supply over the years, it added.

The country's coal output increased to 777 MT in 2021-22 over 716 MT in 2020-21.

Therefore, despite a steep rise in actual demand for coal from 906 MT in 2020-21 to 1,027 MT in 2021-22, imports could be contained due to increased domestic dispatch from 691 MT in FY21 to 818 MT in FY22.

Coal imported by non-regulated sectors, including cement and sponge iron, increased to 125 MT in FY22 from 119 MT in FY21.