In order to ensure fuel for the upcoming power projects, the newly appointed Minister of State for Power Jyotiraditya Scindia must immediately resolve the coal linkage issue, industry body Assocham said.
Further, the body asked government to encourage coal imports till the time domestic production is increased. Imports of essential raw material like coal will only help add value to the Indian economy, it said.
While demand for coal for thermal power generation may be 476 million tonne in 2012-13, domestic supplies is pegged at only 407 million tonne, requiring the balance to be met through imports.
The point has been well highlighted by the Reserve Bank as well which underscored the need for revival of investment sentiment in the infrastructure sector. The central bank pointed out that demand-supply gap in coal is projected to rise further during the Twelfth Plan, Assocham said.
According to an RBI report, new plants that have been commissioned on the basis of coal linkage are facing severe constraints in the absence of committed Fuel Supply Agreements (FSAs).
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