Can the republic meet the expectations of existing importers?
Indonesia is not the kingpin of coal exports without justification. However, its reason episode of balancing domestic market obligations and commercial interests gave India an opportunity to expand its export capacity. Yet the latter has its own set of challenges to overcome, substantiated by industry observers.
Might be a long shot
A major media recently reported Indian coal miner, Coal India has plans to augment its export to neighbours. However, industry observers expressed reservations of its feasibility. Sources quoted revealed the state-owned miner planned to sell some output to Bangladesh, Nepal and Bhutan – in accordance to the republic’s “neighbourhood first” foreign policy. Coal India is responsible for more than 80 per cent of the country’s supply.
Wang Yongzhong, Head of the Institute of World Economics and Politics under the Chinese Academy of Social Sciences expressed doubts; Indian coal may not be the best options for major importers. Wang pointed out, “Major coal buyers such as China, Japan and South Korea in the region used to import coal from Indonesia, Russia and Australia with acceptable price and quality.” Moreover as at 4 February 2022, parts of Bengaluru (India) were still battling outages. Poor quality coal laced with impurities or other material can damage power plant equipment, which results in supply delays and hiked costs.
Putting two and two together, it is apparent India has to sort out its domestic supply issues before taking on ambitious export goals. Wang added that the volume on global coal market is abundant at present, and the exported coal from India may be used for adjustment for its domestic energy source reserves. Therefore, it may be a long shot for India to fulfil the global market demand.
Marine Online News Team
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