Why is the Coal Industry important for the Country's Economy?

mainly depends on many factors such as technological, economic, and social factors.

A variety of equipment is used in coal mining operations, some of which include dozers, scrappers, drilling & blasting, shovels and trucks, Draglines, Wheel excavators, and many others.

Energy Crisis deepens in the country

India is grappling with 2 main challenges such as surging electricity demand as industrial activity bouncing after pandemic restraints were lifted and a slump in local coal output. India meets around 3 quarters of its demand domestically, but unfortunately, heavy rains have not only flooded mines but also the key transport routes.

Furthermore, the coal-fired plant Operators are facing a dilemma whether to pay huge premiums at domestic auctions in order to secure any available local supply or set upon a seaborne coal market where the prices have increased to the highest on record. Already, the government is drawing up guidelines to see if it requires to bring idle power stations back into action.

“Until supplies stabilize completely, we are likely to see power outages in some pockets, while customers elsewhere may be asked to pay more for power,” said Pranav Master, director for infrastructure advisory at credit rating firm Crisil Ltd. “Because of imported coal prices shooting through the roof, plants running on domestic coal have had to do a lot of heavy lifting. Things are expected to get better as the rains abate.”

“The impact on consumer prices would show up a few months later when distribution utilities get regulatory approvals to pass on the cost,” he said.

As per the government data, Coal inventories at Indian power plants dropped to around 8.1 million tons at the end of last month, which is about seventy-six percent less than a year earlier. Also, the average spot power prices at the Indian Energy Exchange Ltd. jumped more than sixty-three percent last month to 4.4 rupees/kW hr.

The increasing electricity bills are expected to make a dent in the country’s outstanding growth rate. As per a Bloomberg News survey, the economy is predicted to grow at 9.4 percent in the year through March 2022. And, this would be the fastest pace among major global economies,

The energy crunch is more of a reminder of the crucial role coal plays in India’s economy and the consumption of coal is predicted to surge in the coming years.

“Supplies to power plants are currently short by between 60,000 and 80,000 tons a day on the impact of the prolonged rains that have drenched coal pits,” said Anil Kumar Jain, India’s coal secretary. “Unusually heavy downpours last month in Dhanbad, a major coal-mining center in the east of the country, have worsened the situation. Coal India should be able to increase supplies enough by the second week of October to cover the deficit at power plants, although that will depend on the weather, Jain added.

However, it would take even more longer to replenish the stockpiles that are depleted, badly.