Domestic Coal Production to Touch 1.15 Billion in FY26

India’s domestic coal production reached a record high of 1,047.6 million tonnes (MT) in FY25, marking substantial growth from 716.1 MT in FY21, at a compound annual growth rate (CAGR) of approximately 10 per cent over the past five years.

As of January 2025, the Ministry of Coal has allocated a total of 184 mines, with Mine Opening Permissions granted for 65 blocks. These operational blocks have collectively produced 136.59 million tonnes (MT) of coal, representing a 34.20 per cent increase over the previous year.

“With domestic coal production expected to hit 1.15 billion tonnes and meet 83 per cent of the domestic demand in FY26, India is firmly progressing toward coal self-sufficiency,” said Nitu Singh, Associate Director, CareEdge Advisory & Research.

India’s coal production has risen sharply since the COVID-19 pandemic, increasing by over 330 million tonnes over the past five-year period ending FY25. Domestic coal production accounted for 76 per cent of the consumption in FY22 and it has moved up to 82.5 per cent in FY25 and is expected to further inch towards 83 per cent in FY26.

This reflects a structural shift towards domestic self-reliance and reduced import dependence. Initial recovery gained momentum through key policy reforms, including the expansion of commercial coal mining, faster clearances, and improved evacuation infrastructure. Greater private sector participation, higher captive mine output, and steady production by Coal India Limited (CIL) and Singareni Collieries Company Limited (SCCL) have supported this growth.

Interestingly, our imports were high in FY22 and FY23 when international coal prices were at multi-year high. Imports have been coming down since then. India’s dependency on imports have come down from 24 per cent in FY22 to 17 per cent by FY25. India’s coal demand may hit 1.5 billion tonnes by 2030.