Coal demand-supply gap to reach 185 MT by 2016-17: Jaiswal

Country imported a record 135 MT of coal last year to meet domestic requirement

The demand-supply gap in coal may widen to 185.5 million tonnes in 2016-17 though many measures have been taken to step up production of the dry fuel, Coal Minister Sriprakash Jaiswal said today.

The country had to import a record 135 million tonnes (MT) of coal last year to meet domestic requirement.

"In spite of best of our best efforts, a gap in domestic supply and demand of 185.5 MT is envisaged in the terminal year 2016-17 of X11 Five-Year Plan," the Minister said at an event here.

Stating that Coal is the mainstay of India's energy programme as 55% of primary energy supply and 70% of power generation are dependent on the dry fuel, Jaiswal said India needs to be "more aggressive" in its approach towards acquiring assets abroad.

He said Coal India, which invited bids in February for acquiring overseas assets, has shortlisted 17 of 32 proposals it received. It had acquired two blocks in Mozambique earlier.

Jaiswal said India, the third largest producer after China and US, has 299 billion tonnes resources and 123 billion tonnes of proven reserves, which may last for over 100 years.

The domestic production was 557 MT in 2012-13 and in first five months of 2013-14  there has been a 2.7% growth in CIL's output over corresponding period last year.

"The coal production target for 2013-14 is set at 604.5 MT," he said.

As far as coal availability to the power sector is concerned, it has "increased by 12.2% from domestic sources i.E. Against 302.3 MT in 2011-12; the availability in 2012-13 has been 339.2 MT. There has been a growth in coal based generation by 13.9% in 2012-13 over 2011-12," he said.

However, he pointed out that despite huge reserves and no financial constraints "coal companies are facing difficulties in augmenting production due to issues like environment & forestry clearances, land acquisition and rehabilitation issues and law & order issues."

He said the Ministry had taken up the matter with concerned Ministries and state governments to address the issues while the government has already set up a Cabinet Committee on Investment to expedite decision making process for clearance of projects in Infrastructure sector.

He added that government is also taking a number of steps to increase production and has already allocated 14 coal blocks with 8,311 MT reserves to 6 central and 15 state PSUs under new guidelines, which would help in operation of 31,800 MW power capacity, leading to Rs 1,60,000 crore investment.

On approval of a methodology for auction of coal blocks, he said, " This is a major achievement of my Ministry. The new policy aims to bring more transparency in the allocation of coal blocks. This would attract investment in energy sector."

On fuel supply agreements (FSA) he said, CIL has so far signed 142 FSAs with power firms having a capacity of about 65,000 MW.