With India crossing the one-billion-tonne coal production threshold last year, power demand projected to hit new peaks this summer, and Coal India lining up ₹16,000 crore in capital expenditure for FY26, the country’s largest miner is entering a phase of volume expansion, logistics build-out and diversification aimed at securing energy supply well into the next decade. In an interview with Saurav Anand, Coal India Chairman and Managing Director B. Sairam gives details about the company’s production roadmap, infrastructure investments, cleaner coal push and entry into critical minerals.
Q1: CIL has been ramping up domestic production even as coal imports remain sizeable. What are your medium-term targets, and when do you see thermal coal imports tapering?
A: Production targets are assigned by the government based on demand projections. India already breached one billion tonnes of coal output last financial year, and CIL has drawn a definitive roadmap aspiring for 1 BT, aligning with the demand forecast.
India has scarce coking coal reserves needed for steel making, making imports essential. There are also around 17 imported coal-based power plants operating on high-grade thermal coal where imports are required.
Thermal coal forms the baseload of power generation, and imports here can be reduced with higher indigenous production. CIL has fuel supply agreements with thermal plants and is meeting their requirements, along with spot auctions.
Currently, our pitheads have about 115 million tonnes of coal, and domestic coal-based plants are stocked with around 55 million tonnes—the highest ever for this period. That translates to about 24 days of stock. With summer approaching, there will be sufficient coal in the system to meet any surge in power demand.
Q2: Coking coal remains a structural vulnerability for India. Is CIL pursuing overseas resources or long-term contracts?
A: We are exploring opportunities based on techno-commercial viability and logistics feasibility.
Q3: CIL has stepped up investments in mechanisation and evacuation infrastructure. What does the capex plan look like?
A: Our capital expenditure target for FY26 is ₹16,000 crores. About 35%, or ₹5,622 crore of the total, is centred on strengthening evacuation infrastructure—rail corridors, sidings and First Mile Connectivity projects like coal handling plants and silos. Some spending is also on roads and weighbridges.
Plant and machinery, including heavy earth-moving equipment and washeries, accounts for about ₹1,950 crore, while land procurement is targeted at ₹2,382 crore.
Land and machinery drive production growth, but a strong evacuation network is critical for handling higher volumes of despatch in future.
Q4: There has been discussion around unlocking value through subsidiary listings. What is the roadmap?
A: As directed by the government, we will move to unlock the potential of our subsidiaries. The strong response to BCCL’s IPO, which was subscribed 147 times, was encouraging.
Central Mine Planning and Design Institute is lined up for listing, and there is in-principle approval for South Eastern Coalfields Limited and Mahanadi Coalfields Limited.
Q5: How is CIL aligning with India’s clean energy transition?
A: Coal production and sales will remain our core business. At the same time, we are adopting a structured approach towards cleaner coal technologies and diversification into new energy.
Coal gasification is a key focus, with products such as ammonium nitrate for explosives and synthetic natural gas for fertiliser plants. We are also pursuing solar power and aim to have 3,000 MW of solar capacity by FY28.
We have research partnerships with IIT Dhanbad, IIT Hyderabad and IIT Madras, including work on carbon capture and utilisation.
Q6: CIL has also been mandated to explore critical minerals. Which resources are you prioritising?
A: We are focusing on graphite, lithium, rare earth elements, vanadium, potash and copper—minerals essential for clean energy, batteries and industrial competitiveness.
We have already secured graphite, vanadium and rare earth blocks through domestic auctions and are exploring overseas assets in Australia, Argentina and Chile through phased investments and partnerships.
Q7: Washeries are critical for improving coal quality. What are your expansion plans?
A: CIL presently operates 10 coking coal washeries having 18.35 MT Per Annum (MTPA) operable capacity. However, majority of them are aging. We are adding 8 new washeries in coking coal domain with a capacity addition of 21.5 MTPA. Besides, one old inoperative washery in BCCL was auctioned under asset monetisation scheme. Two more old inoperative washeries are also in the process of monetisation. Further two pf the old operative ones are being renovated. The aim is to expand the washery capacity to a level of 44 MTPA by FY 2030.
In non-coking coal domain, CIL currently operates 3 washeries having 21.5 MTPA capacity. These actions will help improve coal quality and reduce import dependence over time.
Q8: From an investor perspective, how should markets view CIL’s long-term earnings outlook?
A: Coal will remain India’s assured energy provider for the next two decades, forming the baseload of power generation.
Our position as a low-cost producer supports earnings stability. Since most costs are fixed, higher volumes directly strengthen the bottom line. Productivity gains, logistics optimisation and diversification initiatives will further support long-term resilience.