In what could deepen Indo-US bilateral energy partnership, New Delhi is planning to increase import of coal from the US. India has a shortage of coking coal, used for steel production. “We are having business and policy-level interactions for long-term engagement with the US for sourcing coking coal,” steel and petroleum minister Dharmendra Pradhan said.
Given India’s plan to raise domestic steel output from the current level of 140 million tonne (MT) to 300 MT by 2030, the requirement of coking coal is seen to rise 190% to 175 MT. American oil supplies to India have jumped ten-fold to 2,50,000 barrels per day (bpd) in the last two-three years. Speaking at a business meeting alongside US President Donald Trump, US energy secretary Dan Brouillette said India imported just 25,000 barrels a day of crude oil from the United States in 2017.
In the event organised by the Confederation of Indian Industry and US India Business Council (USIBC), Pradhan asserted that though the country is gradually moving towards increasing the share of gas and renewables in the energy basket, it will continue to use coal due to its affordability. In the first nine months of this fiscal year, the country imported 52.5 MT (11.2% of total requirement) of thermal coal for producing electricity.
Australia is the country’s largest coking coal supplier, with supplies of $7.4 billion — 72% of India’s coking coal import by value — of the metallurgical fuel in FY19. In FY19, India imported 4.1 MT of coking coal from the US, worth $850 million. India is already US’ fourth largest crude oil export destination and the fifth largest importer of US LNG.
CII and USIBC also jointly launched a report that prescribed policy reforms needed to reach the $500 billion target in Indo-US bilateral trade. The report, titled ‘$500 Billion Roadmap’, recommended waivers for India from US sanctions for importing oil from Iran and Venezuela to allow it time to diversify its energy sources without impacting its economic progress in the process. “The US should look to be a larger crude oil and shale gas supplier to India, but also look at ethanol for export expansion,” the report added.
