India’s Coking Coal Imports to Reach 135 Million Tonnes by 2030 as Steel Demand Surges

India’s coking coal imports are expected to climb sharply in the coming years, driven by the country’s ambitious plan to expand steelmaking capacity to 300 million tonnes by 2030. According to a report by EY-Parthenon in collaboration with the Indian Steel Association (ISA), imports could rise from 87 million tonnes in FY25 to 135 million tonnes by 2030.

As the world’s second-largest steel producer, India remains heavily reliant on coking coal, which is essential for the blast furnace-basic oxygen furnace (BF-BOF) route that accounts for the majority of the country’s steel output. At present, the steel industry consumes 95% of India’s total coking coal demand, underscoring the strategic importance of securing reliable supplies.

To reduce import dependency, the government has launched the Atmanirbhar Coal Mission under Mission Coking Coal. This initiative aims to double domestic raw coal production from 66.8 million tonnes in FY24 to 140 million tonnes by FY30. Of this, 105 million tonnes is targeted from Coal India, while 35 million tonnes will come from private sector allocations. In addition, the plan seeks to expand washed coal capacity to 15 million tonnes.

Policy reforms are also expected to play a crucial role. Measures such as 100% FDI in mining, revenue-sharing auctions, and capital subsidies of up to 30% for coal washeries are designed to encourage private participation and improve beneficiation. The goal is to reduce import reliance from nearly 90% today to below 80% by 2030.

However, challenges remain. Heavy dependence on imported coal exposes the industry to global price volatility, highlighting the need for an India-specific CFR index to support risk hedging. Sustainability concerns are also rising, as the steel sector contributes nearly 12% of India’s total greenhouse gas emissions.

Experts stress that along with boosting domestic production, India must invest in cleaner technologies such as green hydrogen, scrap-based electric arc furnaces (EAF), and carbon capture to balance growth with environmental commitments. Building strategic reserves and overseas mine partnerships will be equally critical in ensuring supply security for the decades ahead.