India is talking to South Africa to buy coal mines there to feed its expanding steel industry, Coal Secretary Anil Swarup said, adding that New Delhi also hopes to stop imports of coal used to generate power in three years as domestic output jumps.
After years of poor production crippling power supply, state-run Coal India is boosting output at a record pace to meet Prime Minister Narendra Modi’s goal of connecting to the grid millions of Indians who still make do with kerosene lamps.
But India, which wants to triple its steel capacity to 300 million tonnes by 2025, does not have enough reserves of coking or steel making coal, prompting Coal India to look at assets abroad, Swarup told the Reuters Global Commodities Summit on Monday.
“They are presently in negotiations with people in South Africa,” Swarup said. “We imported around 80-90 million tonnes of coking coal last fiscal year and if that is the amount that can come through a mine owned by Coal India, it would consider it.”
Swarup declined to give any investment figure but said money was not an issue for Coal India, which had cash and bank balance of more than $8 billion for the year ended March 31.
Overall coal imports into India, the world’s third-largest buyer, fell for the third straight month in September in a country used to seeing shiploads coming in as new power plants started.