It’s up in air that the world’s largest coal producer India is under pressure and it may need to cut output without a price hike. Raising coal prices is included in long-term supply agreements which would require backing of the government. It is weighing higher impact on the country’s inflation and broader economy.
Coal India Ltd. warned that the production of the fuel may fall. There is a rising threat to the nation’s energy supply, if the company is not able to rise up prices. Some of the company’s units are finding it difficult to exist without the price hike.
Increasing coal prices which would require backing of the government and chances of increasing the rates. Coal reserves at power plants have risen from a low in September, there is still only about a third of an April 2020 high, power demand will increase more at the time of summer.
Now even the country is coming back to its earlier position after post COVID-19. People started going to their business, office, schools and colleges. It means that the usage of resources are going to increase than earlier. As their is an arrival of summer, the consumption of refrigerators and air conditioner gets increase.
Chairman Mr. Pramod Agrawal stated on Thursday that price hike should take place immediately, it has become very urgent for Coal India. Otherwise, the coal production in India will suffer. Coal India expects to supply 670 million in the fiscal year ending March, almost 17% higher than a year earlier. For a year, the company has set a production target of about 700 million tons.
