India is moving to bolster its underground coal mining program with a clear objective: by 2028, annual production could reach about 100 million tonnes, a figure that would triple the current output. This strategic shift, as reported by Finance Times, signals a major reorientation of the country’s energy framework toward more contained extraction methods and greater resource recovery within coalfields. The move is framed as a critical lever for sustaining industrial activity, powering growing demand from manufacturing, railways, and power generation, and reducing vulnerability to import disruptions that have periodically unsettled the electricity sector.
Speaking on the matter, a ministry official named Amrit Lal Meena stressed that expanding underground mining capacity is essential to support sustained economic growth. The rationale rests on the belief that deeper underground operations can help unlock reserves that are not easily accessible through open-pit methods, thereby enabling longer mine life and more stable supply chains. Proponents argue that this approach could also improve safety and environmental performance by limiting surface disturbances and enabling more controlled extraction, though officials acknowledge that implementation will require careful planning, investment, and regulatory safeguards.
Currently, roughly 95 percent of Indian coal is produced via open-pit mining, a reality that reflects decades of investment in surface operations and the natural geography of many coal basins. Analysts have noted that the shift toward underground mining carries multiple implications for output efficiency, labor requirements, and local ecosystems. Market observers, including industry representatives, have pointed out that the development of underground corridors may demand new technologies, specialized equipment, and intensified capital expenditure. As the sector evolves, questions remain about how to balance cost structures with the need to curb surface land use and to manage subsidence risks while meeting rising demand from power producers and industrial users.
Discussions around inviting greater foreign investment into underground coal mining form another pillar of India’s strategy. While authorities in New Delhi appear keen to attract international partners to finance and operate underground projects, experts warn that the path to successful execution will be paved with regulatory certainty, robust risk management, and transparent project bidding. A senior analyst from a prominent policy center notes that while capital is available, there are challenges around securing technical expertise, aligning environmental standards, and ensuring that local communities share in the benefits of new mines. The appreciation of these realities has led policymakers to emphasize clear policy frameworks, reliable power demand projections, and credible social impact assessments as prerequisites for attracting sustained overseas investment.
In the near term, there are indications that India might increase coal imports from Russia to bolster supply during the transition period as domestic underground capacity ramps up. This forthcoming phase would be a pragmatic step to meet current demand while domestic underground projects reach full-scale operation. Observers caution, however, that such an approach requires careful contract management, price hedging, and rigorous scrutiny of logistics to avoid price volatility and supply interruptions that could affect electricity tariffs and industrial costs. The dynamic between imports and domestic production will shape how sharply the country can reduce exposure to global supply shocks while pursuing a long-term plan to enrich its own mining capabilities and energy security.
Earlier public discussions in the West about coal investment trends have reflected divergent views on the role of coal in a transitioning energy mix. Some stakeholders have argued for maintaining coal as a reliable backbone for baseload power, while others have pressed for accelerated diversification toward cleaner energy sources. India’s course, focused on reinforcing underground coal mining and curbing overreliance on surface operations, embodies a pragmatic stance that prioritizes energy reliability and economic resilience. The evolving policy environment, factored with ongoing technological advancements and international partnerships, could position India to modernize its coal sector while navigating environmental responsibilities and social impacts that accompany deeper mining operations and long-term industrial growth.