Need to consume domestic coal instead of imported fuel to cut forex costs: Coal India tells NRS

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26 Aug, 2025 12:21

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Coal India has asked the non-regulated sector (NRS) consumers, who import coal for blending purpose or direct use, to meet their fuel requirement domestically through its e-auction schemes to decrease foreign exchange costs.

The development assumes significance as Coal India (CIL), which accounts for over 80 percent of the domestic fuel output at present, has sufficient fuel to cater to the demand.

In a notice to its NRS consumers on Tuesday the maharatna firm said that "it has been observed that several non-power plants in India are importing coal from different countries for blending purposes or direct use."

“A need has arisen for consumption of domestic coal instead of imported coal to save valuable foreign exchange and as sufficient domestic coal is available with Coal India."

In view of the above, it requested NRS consumers to meet their requirement against import substitution through various e-auction schemes available, like spot e-auction and exclusive e-auction, regularly being conducted by subsidiaries of CIL, who have been advised to offer sufficient quantities to meet any additional requirement.

"Therefore, consumers are requested to contact CIL coal companies for placing their demands through e-auctions," the notice said.

CIL has been mandated by the government to replace at least 100 million tonne (MT) of imports with domestically-produced coal in the ongoing fiscal.

The centre had earlier also asked power generating companies, including NTPC, Tata Power, Reliance Power to reduce the import of dry-fuel for blending purposes and replace it with domestic coal.

The power sector is a key coal consumer.

Prime Minister Narendra Modi had also given directions to target thermal coal import substitution, particularly when a huge coal stock inventory is available in the country this year.

Coal Minister Pralhad Joshi had earlier written to state chief ministers asking them not to import dry-fuel and take domestic supply of fuel from CIL, which has the fuel in abundance.

The country's coal imports increased marginally by 3.2 percent to 242.97MT in 2019-20.

India is planning to bring 'avoidable coal imports' to zero by 2023-24 amid abundance of the fuel stock.