India May Buy Coal Mines Abroad, Raise Local Output

By Debarati Roy

Dec. 12 (Bloomberg) -- India may buy coal mines in the U.S., Australia and Mozambique to meet increasing demand for the fuel from domestic users, said Santosh Bagrodia, junior coal minister.

The South Asian nation plans to allot more coal mines to private companies for captive mining and is seeking partners to reopen 18 mines to help boost local production, Bagrodia told reporters in New Delhi today.

India, Asia’s third-biggest economy, needs coal to meet demand from power plants, steelmakers and cement companies. The government estimates imports of the fuel will increase to 60 million tons annually by 2012.

India may produce 415 million metric tons of coal in the year to March and import as much as 31 million tons, Bagrodia said. Coal production may rise by 8 percent next year, he said.

Power utilities in India may import 20 million tons of coal in the year to March, according to the Central Electricity Authority. More than half the generation capacity of about 146,752 megawatts as of Oct. 31 is coal-fired.

The peak power shortage in India may widen to 18.1 percent in the year to March as demand in the world’s second-fastest growing major economy outstrips supply, the Central Electricity Authority has said.

To contact the reporter on this story: Debarati Roy in Mumbai at droy5@bloomberg.net.