According to an analysis by the Planning Commission, the shortage of coal in the country is expected to be worse than what was estimated previously. About 78% of the fossil fuel produced in the country is used by thermal power plants and this accounts for half of India's commercial energy consumption.

Mr Sriprakash Jaiswal coal minister of India said that mid term appraisal by the Plan Panel has estimated the coal shortage in 2011 to 2012 to be 81.03 million tonne, implying that this gap between demand and supply will have to be met through imports. India's national coal miner, Coal India Limited along with its subsidiaries is expected to produce 486.5 million tonne of the fossil fuel during 2011 to 2012 about 11.8 % more than the estimated 435 million tonne in 2009 to 2010.

According to latest data, CIL has already mined 184.44 million tonne of coal. Also, the expected shortage of coal during 2009 to 2010 has been estimated at 70 million tonne. He added that according to an analysis by a working group, the shortage of coal is expected to be 86.5 million tonne in 2016 to 2017 when CIL is expected to produce 647.5 million tonne of coal.

The coal ministry is taking 2 pronged approaches in order to meet the shortfall. Mr Jaiswal informed the Rajya Sabha that CIL intends to develop coal projects in Mozambique, Australia, Indonesia, South Africa and USA. In addition, the ministry has allotted 208 coal blocks and these which will help reduce the deficit. Allocation of coal blocks so far has not met the targets set by the government. The Economic Survey tabled in July this year mentions that as against a targeted 125 mine allocations during the 11th Five Year Plan only 40 have been allocated.

The integrated energy policy of the country that lays down a road map for India to attain energy security has called for allocation of CIL coal blocks which cannot be developed by the government owned miner to eligible companies by 2016 to 2017.

Mr Pranab Mukherjee finance minister of India had recently said that the government was considering a proposal to set up a regulator for the sector. According to the Integrated Energy Policy, miners in public and private sectors should be encouraged to explore coal through a program similar to Nelp in the oil and gas sector. The proposed coal regulator will also help in having a stable.

(Sourced from Financialexpress.com)