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India does not rule out restrictions on low-grade coal imports from Indonesia
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7th June 2013
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KOLKATA ( - India would not rule out imposing restrictions on the import of low-grade thermal coal from Indonesia, the Coal Ministry said this week, referring to regulation of that nature proposed by China.

According to a senior official in the Coal Ministry, imposing restrictions on the import of low calorific coal from Indonesia was on the table, considering the impact such imports had on the environment, the constraints in port handling capacity and the longevity of thermal power generating boilers.

However, the official added that any proposed restriction on low-grade thermal coal imports would have to be well considered and calibrated based on a comprehensive risk-benefit analysis on the projected import of low-grade coal into the country, given the acute coal shortage from domestic mines. The imperative of maintaining growth in thermal power generating capacity would also have to factored in.

Commenting on several reports indicating that India would not go 'the China way' in immediately imposing restrictions on coal imports, the official said that India could not ignore the long-term impact of importing such low-grade coal and, as the fuel shortage in the country was not expected to ease in the short term, all risks associated with import dependency would be under review.

“The issues relating to sustained imports and usage of low-grade coal are too grave not to warrant some form of restriction. But whether it would be a complete ban - like that being considered by China - or quantitative restrictions would be entirely dependent on our 360-degree impact assessment study,” the official added.

Apart from environmental-impact assessment, the increased use of low calorific value (GCV) coal impacted the efficiencies of power plants, which required more feedstock and higher investments in installing more efficient pollution control equipment. This had a bearing on the total costs and tariffs of power generation and any quantitative restrictions would need to be based on such empirical assessment, the official added.

It was towards this end that the Coal Ministry was currently seeking international coal quality assessment and a monitoring agency to set up shop in India and oversee the import of low-grade coal, particularly by coastal power plants reliant on imported coal.

Faced with constraints over new coal mining projects, Indian coal imports have been steadily rising, with bulk sourced from Indonesian mines.

India imported 77-million tons of coal from Indonesia in 2012/13 , followed by 26.8-million tons from Australia and  17.4-million tons from South Africa.

While the calorific value of coal imported from Australia and South Africa ranged between 5 500/5 800, coal imported from Indonesia had a calorific value of as low as 3 600.

Edited by: Esmarie Swanepoel


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