Coal India's Production Dilemma Amid Global Crisis

State-owned Coal India Ltd's subsidiaries reported a decline in coal production for FY 2025-26 amid increased reliance on coal due to global gas supply constraints. With varied performance across subsidiaries, experts underscore the need for strategic stockholding to counter market challenges and meet contractual obligations in India's energy sector.

Amidst a backdrop of global energy crises, state-owned Coal India Ltd's (CIL) key subsidiaries—Bharat Coking Coal Ltd, Central Coalfields Ltd, Western Coalfields Ltd, and Mahanadi Coalfields Ltd—witnessed a decline in coal production during the fiscal year 2025-26.

The trend comes as India grapples with its increased reliance on coal. This situation has been exacerbated by disruptions in global gas and LNG supplies, further affected by geopolitical tensions in West Asia. Compounded by rising imported coal prices, the sector is under pressure to align supply with demand.

While some subsidiaries like South Eastern Coalfields Ltd and Northern Coalfields Ltd registered growth, industry experts raised concerns over hasty production without proper storage, potentially leading to spoilage and supply chain disruptions. Former power secretary Anil Razdan emphasized the importance of maintaining contractual commitments and building adequate coal stocks to ensure energy stability.

(With inputs from agencies.)