India’s Ministry of Coal has set a target to increase domestic coal production by 42% over the next five years, from 1,080 million metric tons in fiscal year 2025-2026 to 1,533 million metric tons by 2030-2031. During FY 2025, India’s coal production from its more than 350 coal mines surpassed 1 billion metric tons for the first time, increasing by 5% and reducing imports by 8.4%. Coal generates over 74% of India’s electricity, increasing 3.5% in FY25, and fuels key industries such as steel and cement. India has the fifth-largest coal reserves and is the second-largest coal consumer, behind China. Coal contributes 55% to the nation’s energy needs, and now approximates peak U.S. production years. The Ministry of Coal wants to reduce coal import dependence through domestic production and promote sustainable mining to reinforce the nation’s energy security and economic stability.
India is currently the world’s second-largest steel producer behind China, and it continues to rely on coal for steelmaking, with increased production from its domestic coking coal mines. India’s mining and construction equipment exports, particularly concrete and road equipment, recorded growth of 133% and 122%, respectively, in FY25 over FY24, while earthmoving equipment remained a dominant sub-segment with 5% growth.
India still relies on imports for a significant share of its coking coal needs, essential for the making of steel. In FY25, Australia supplied just over 53% of its coking coal imports, providing 30.3 million metric tons, down from 74% in FY20. Despite its high quality, Australian coal has lost market share due to rising costs, supply disruptions, and a push by India for diversification to keep costs in check and ensure availability of multiple sources because of a changing geopolitical environment.
Russia and the United States have emerged as new important suppliers, together supplying 30% of India’s coking coal. Between FY20 and FY25, Russia almost tripled its shipments, reaching 8.7 million metric tons, due to its low cost, and the United States more than doubled its shipments to 8.5 million metric tons. Canada, Mozambique, and Indonesia have provided smaller amounts of coking coal to India. Canada’s exports have halved to 1.7 million metric tons in FY25, and Mozambique’s have doubled to 4.4 million metric tons. India’s coking coal imports remain at 57 million metric tons.
China, like India, is using coal to fuel its economy, consuming more coal than the rest of the world combined, and having more coal plants than the entire U.S. fleet of generators from all sources. And China is still building state-of-the-art coal plants with little regulation affecting their cost. Coal fuels Chinese industries like steelmaking and cement production. Additionally, China uses coal power for polysilicon manufacturing, used to produce solar panels that Western countries buy for their green energy transition. It also uses cheap coal power to produce electric vehicle batteries and process critical minerals used in green technologies. China has a huge EV market, and China’s BYD, a manufacturer of electric vehicles, has overtaken Tesla in EV sales.
While China and India continue to grow their economies fueled by coal, the United States, with the world’s largest coal reserves, is having trouble maintaining a viable coal industry due to competition from low-cost natural gas supplies, massive federal subsidies for wind and solar power, renewable power mandates,and onerous regulations by the Obama and Biden administrations. The last large coal plant in the United States was brought online in 2013 and many existing coal plants have retired, reducing coal’s share from 50% to 16% in about 2 decades.
However, coal in the United States may see a partial renaissance as electricity demand is soaring due to data centers for artificial intelligence and cryptocurrency, and increased electrification spearheaded by the Biden administration. Because of that demand and the unreliability of the electric grid due to the addition of intermittent wind and solar plants that cannot operate 24/7, President Trump called for a national energy emergency, and his National Energy Dominance Council is fast at work to improve both the supply of electricity and the reliability of the grid. As part of that effort, Secretaries Doug Burgum and Chris Wright and EPA Administrator Lee Zeldin deem it necessary to keep existing coal plants operating and to investigate whether coal generation, a baseload fuel, can be expanded to meet the nation’s growing needs. Utilities and states are also seeing that need with six states: Arkansas, Wyoming, West Virginia, Kentucky, Nebraska, and Utah, passing laws to protect existing power generation.
Conclusion
India has plans to increase its domestic coal production for national security reasons. It plans to expand it by 42% over the next 5 years, having surpassed the one billion metric ton mark last fiscal year. It has the fifth largest coal reserves in the world and is the second largest steel maker. It generates over 74% of its electricity with coal and still imports the fuel to meet demand. India, like China, is using coal to fuel its economy and raise the living standard of its people. The United States, despite having the largest coal reserves in the world, is using less coal due to competition from low-cost natural gas, massive federal subsidies for wind and solar power, renewable mandates, and onerous regulations by the Obama and Biden administrations. However, President Trump’s push for energy dominance may help revive some of the U.S. coal industry, which has lost over 30 percent of its electrical generating share since 2000.
