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India's coal imports expected to rise on shortfall in domestic production

India's coal imports are expected to increase this year as Coal India Ltd.'s production struggles to meet demand, Bloomberg News reported Feb. 19, citing Benjamin Sporton, chief executive of the World Coal Association.

"Coal India is not quite keeping up to the targets," the report quoted Sporton as saying. "On the other hand, we're seeing a strong growth in power demand."

The state-run coal miner has been curtailing shipments to cement and aluminum companies while prioritizing supplies to power stations as electricity demand rose 6% year over year during the first 10 months of the year ending March 31.

Provisional figures showed Coal India produced 383.9 million tonnes in April through December 2017, 6% short of its target, prompting concerns that the company may miss its annual production goal of 600 million tonnes in 2017 to 2018.

In a separate report, Vinaya Varma, CEO of the Mjunction Services platform, said the healthy growth in coal-fired generation has raised demand for the fossil fuel and resulted in higher off-take from domestic sources as well as imports.

The country's coal imports during the first seven months of the current fiscal year inched down by less than 1% year over year to 116.1 million tons. During the 2016-2017 fiscal year, imports dropped 6.4% to 191 million tons, although they surpassed government estimates of 160.2 million tons, the report said.

"While we have seen a decrease in Indian coal imports in the past couple of years, we'll probably see them increasing over the course of the next 12 months," Sporton said.