India postpones coal import plan amid soaring global prices and a weak rupee
India has halted a proposal to let power plants import coal because high overseas prices and a depreciating rupee make imports too costly.
A proposal to permit Indian power plants to import coal was shelved after global thermal-coal prices rose to their highest level in three years and the rupee weakened, raising the cost of overseas shipments. Policymakers have turned to state-owned Coal India Ltd to increase domestic production and have urged the rail network to ensure timely delivery to generators. Coal inventories at plants have fallen to the lowest in nearly five years, with almost half of stations holding less than a quarter of required stock amid high summer demand and a weak monsoon that cut hydropower output.
September saw the worst power shortfalls in a decade, though the rate of inventory loss slowed in early October. The government expects electricity use to ease as temperatures drop and inventories begin to recover, while rail loading has risen to around 465-470 rakes per day.
Why it matters
India's power supply depends on coal; delaying imports underscores fiscal strain and the need to boost domestic output.
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