Centre Designates Coking Coal as Essential and Strategic Mineral for Steel Sector Self-Reliance
The Indian government has officially designated coking coal as a critical and strategic mineral, a significant move aimed at reducing the country’s reliance on imports and bolstering the domestic steel supply chain. This decision is expected to streamline approvals, enhance the ease of doing business, and accelerate exploration and mining activities, particularly for deep-seated deposits. With coking coal being a vital raw material for steel production, this initiative aligns with the government’s broader objectives to strengthen the steel sector and promote self-reliance.
Government’s Strategic Move
The recent notification by the government categorizes coking coal under the Mines and Minerals (Development and Regulation) Act, 1957, as a critical and strategic mineral. This classification is part of ongoing structural reforms in the mining sector and aligns with the vision of Aatmanirbhar Bharat (self-reliant India) and the goals set for Viksit Bharat (developed India) by 2047. The coal ministry emphasized that this reform is designed to reduce import dependence and enhance supply-chain resilience for the steel industry. Currently, approximately 95% of the coking coal required by the steel sector is imported, leading to substantial foreign exchange expenditure.
The government aims to address this issue by facilitating faster approvals and encouraging private investment in exploration and beneficiation. The reforms are expected to promote advanced mining technologies and create job opportunities across various sectors, including mining, logistics, and steel production.
Impact on the Steel Industry
Coking coal plays a crucial role in steel manufacturing, and the government’s initiative is anticipated to significantly impact the industry. The coal ministry noted that the move would not only lower import dependence but also support the objectives outlined in the National Steel Policy. By promoting the use of domestic resources, the government seeks to strengthen the steel supply chain and ensure a more resilient industrial ecosystem.
The notification also includes provisions that exempt mining of critical minerals from public consultation requirements. This change is expected to encourage greater participation from the private sector in mining activities. Additionally, the government has allowed the use of degraded forest land for compensatory afforestation, further incentivizing private investment in the sector.
Resource Availability and Future Prospects
Despite India possessing approximately 37.37 billion tonnes of estimated coking coal resources—primarily located in Jharkhand, with additional reserves in Madhya Pradesh, West Bengal, and Chhattisgarh—the country has seen a rise in imports. The volume of coking coal imports increased from 51.20 million tonnes in 2020-21 to a projected 57.58 million tonnes by 2024-25. This trend highlights the urgent need for the government’s strategic intervention to optimize domestic resources.
The government has amended the First Schedule of the MMDR Act to include coking coal explicitly, reflecting its importance for mineral security and the domestic steel industry. The decision follows recommendations from a high-level panel and policy inputs from NITI Aayog, underscoring the strategic significance of coking coal in achieving national objectives.
Ensuring Mineral Security
The notification of coking coal as a critical and strategic mineral is a pivotal step towards reinforcing national mineral security. The government clarified that royalties, auction premiums, and other statutory payments related to mining leases will continue to benefit the respective state governments, even when mineral auctions are conducted by the Centre. This ensures that local economies also gain from the mining activities.
By optimizing the utilization of domestic coking coal resources, the government aims to build a self-reliant industrial ecosystem. This initiative is expected to advance the vision of Viksit Bharat, contributing to a more resilient and sustainable steel industry in India. The strategic focus on coking coal is a clear indication of the government’s commitment to enhancing the country’s mineral security and reducing its dependence on foreign resources.
Observer Voice is the one stop site for National, International news, Sports, Editor’s Choice, Art/culture contents, Quotes and much more. We also cover historical contents. Historical contents includes World History, Indian History, and what happened today. The website also covers Entertainment across the India and World.
Follow Us on Twitter, Instagram, Facebook, & LinkedIn
