One Billion Tonne: Strengthening India’s Energy Future

The Prime Minister declared the achievement of exceeding 1 billion tonnes of coal output in FY 2024–25 as India's moment of achievement for securing its energy independence while demonstrating national self-sufficiency. Such an accomplishment demonstrates India's advancement in creating energy independence while driving national economic progress while weakening dependency on international suppliers. Gevra and Kusmunda coal mines operated by South Eastern Coalfields Limited (SECL) under Coal India's subsidiary create a major industrial contribution in Chhattisgarh by ranking second and fourth on the worldwide list of the biggest coal mining facilities.

Key Highlights

India’s Coal Production Milestone

• On March 20, 2025, India achieved its 1 BT target which happened eleven days earlier than the performance during the previous fiscal year.

• The Indian energy sector depends significantly on coal as it produces 55% of national energy and 74% of electricity in the country.

• Coal import levels dropped by 8.4% between April and December of 2024 which resulted in saving ₹42,315.7 crore equivalent to $5.43 billion from foreign exchange reserves.

• The Ministry of Coal applied their strategic reforms to achieve this growth.

About Coal Production in India

Historical Background

• The practice of commercial coal extraction started in India during 1774 when operations began at Raniganj Coalfields which sat beside the Damodar River.

• Nationalisation of Coal:

  • Under the Coking Coal Mines Act of 1972 the Indian government took control of coking coal extraction sites.

  • Under the Coal Mines (Nationalisation) Act the Indian government took control of all non-coking coal mines during 1973.

Key Reforms/Initiatives in Coal Sector

• The Coal Mines (Special Provisions) CMSP Act, 2015 gave private entities permission to operate commercially in the mining industry.

• A new program launched its first coal mining auctions in the year 2020.

• Mines and Minerals (Development and Regulation) Amendment Act, 2021:

  • New processes enhanced the visibility of mining license distribution procedures.

  • The licensing system now provides Combined Prospecting License-cum-Mining Lease (PL-cum-ML).

  • Removed end-use restrictions for captive miners.

• National Coal Index (NCI): 

  • Tracks coal price fluctuations from different sales channels.

  • The government allows 100% FDI in coal mining to invite global expertise in the industry.

• Amendment to New Coal Distribution Policy (NCDP), 2007: Allowed transparent sales from closed/abandoned mines.

Recent Initiatives to Boost Domestic Production

• The Integrated Coal Logistic Policy and Plan, 2024 seeks to establish a cost-efficient resource for coal transport systems.

• The government approved an 8,500 crore rupee scheme to promote coal and lignite gasification operations.

• PM Gati Shakti - National Master Plan in the coal sector.

Major Coal Mines in India

• Gevra along with Kusmunda which are operated by SECL under the Coal India subsidiary situated in Chhattisgarh have recently claimed positions as the 2nd and 4th largest coal mines across the globe.

• The Korba district of Chhattisgarh hosts two mines that generate above 100 million metric tons of yearly coal output making up 10% of India's total coal production.

Persistent Issues/Challenges in Coal Sector

• High Import Dependence:

  • The Indian energy market does not possess sufficient stocks of coal that match high Gross Calorific Value standards (GCV).

  • The main sources of imported coal come from Australia together with Russia and South Africa along with USA.

  • The domestic coking coal contains ash levels between 28-42% while imported coking coal possesses less than 10% ash content.

• Dominance of Coal India Limited (CIL):

  • Coal India Limited generates more than 80% of all coal delivered in Indian markets.

  • Allegations of market dominance and supply of lower quality coal.

• Advanced technology in the industry creates performance declines and spending increases along with safety threats.

• The absence of multi-modal transport systems leads to expensive coal delivery costs throughout the logistics sector.

• The practice of open-cast mining results in permanent destruction of the land.

• The development of new mines requires relocation of current inhabitants in the affected areas.

Other Challenges:

• Unpaid dues from power sector consumers.

• Labour and industrial relations issues.

• The area containing coal reserves has seriously suffered from unexpected rainfall occurring during the wrong season and rainfall that exceeded average levels.

Way Forward

• Sustainable practices will be promoted through the Miyawaki plantation method to establish green areas adjacent to mining operations.

• More private coal operations should be supported because it will decrease CIL's control position and advance mining technology development.

• Import Substitution Strategies:

  • The coal linkage policy needs logical restructuring to lower the distance between production sites.

  • Early operationalization of captive/commercial coal blocks.

  • The government requires power plants to operate using coal obtained from local domestic sources.

  • The steel industry must develop its dependence on synthetic gas through improved coal gasification procedures.

About Coal

• The organic sedimentary rock coal exhibits black and brownish-black coloration and consists primarily of carbon.

• A sequence of natural processes begins when plant matter starts decomposition into what becomes peat which will eventually develop into coal.

Types of Coal in India:

• Anthracite coal exists at the highest grade level in the region of Jammu & Kashmir.

• The generating sector uses bituminous coal extensively since it exists across Jharkhand, Odisha, West Bengal, Chhattisgarh, and Madhya Pradesh and parts of Tamil Nadu.

• Black subbituminous coal possesses lower lustrous appearance than both lignite and higher calorific value.

• Lignite presents the lowest grade coal formation that can be located in Rajasthan and Tamil Nadu and Jammu & Kashmir regions.

Conclusion

Reach rates exceeding 1 billion tonnes of coal production demonstrate a major triumph for India by advancing its capacity to secure its energy needs. Success in coal production results from implemented reforms and private sector involvement alongside technological advancements. Policy makers need sustained emphasis to resolve pressing matters including environmental threats together with export dependence and delivery system problems. National energy security depends on achieving sustainable operations along with innovative methods to maximize efficiency during the coming years.