India's coking coal import bill down 39% in three years helped by Russian discounts, low-price global cycle
India's coking coal import bill fell from $19.2 billion in fiscal 2023 to $11.76 billion in fiscal 2026, a decline of about 39%
The fall reflects a shift in sourcing away from Australia toward Russia and the United States, together with a broader low-price phase in the global coking coal cycle
Domestic coking coal production remains insufficient to meet the steel industry's requirements, so Indian steelmakers remain structurally exposed to global commodity price cycles despite the lower import bill
The reduced bill reflects favourable pricing and sourcing diversification rather than any reduction in India's underlying import dependence for coking coal
Coking Coal, Import Dependence, and the National Steel Policy 2017
Coking (metallurgical) coal differs from thermal coal in its "caking" property, which allows it to be converted into metallurgical coke — the reducing agent used in blast furnaces to produce iron and steel. Because usable coking coal reserves in India are limited in both quantity and quality, the country remains heavily import-dependent even as it is one of the largest steel producers in the world.
Key Details
- The National Steel Policy, 2017 set a target of reducing coking coal import dependence from around 85% to around 65% by 2030-31, to be achieved through higher domestic washed-coal availability
- The government notified coking coal as a "Critical and Strategic Mineral" under Part D of the First Schedule to the Mines and Minerals (Development and Regulation) Act, 1957 — a category created by the MMDR Amendment Act, 2023 — in January 2026
- India holds an estimated 37.37 billion tonnes of coking coal resources, concentrated mainly in Jharkhand, but current government assessments put the steel sector's import dependence at close to 95%, underscoring the gap between resource availability and usable, high-quality coking coal
- "Mission Coking Coal" targets raising domestic raw coking coal production toward about 140 million tonnes by FY30, up from roughly 66.8 million tonnes in FY24
The 39% fall in the import bill is a price-and-sourcing effect, not a dependence effect — India's structural reliance on imported coking coal, the subject of the National Steel Policy target and the 2026 critical-mineral notification, is unchanged by this development.
India-Australia ECTA (2022) and Coal Trade Diversification
The Australia-India Economic Cooperation and Trade Agreement (ECTA) is an interim trade pact that eliminated tariffs on the bulk of Australia's goods exports to India, including coking coal, on entry into force. India's shift of coking coal purchases toward Russia and the US despite this tariff-free access illustrates that landed price, not tariff treatment, is the decisive factor in coal sourcing decisions.
Key Details
- ECTA was signed on April 2, 2022 and entered into force on December 29, 2022; it eliminated tariffs on over 85% of Australia's exports to India by value immediately, including coking coal and thermal coal
- Coking coal has historically accounted for the large majority of Australia's goods exports to India by value, making it the single most significant commodity under the agreement
- A fuller Comprehensive Economic Cooperation Agreement (CECA) between India and Australia, covering services and deeper market access, remains under separate negotiation
- Despite zero-duty access, Australia's share of India's coking coal imports has declined in recent years as Russian and US supplies became more price-competitive
The bill's decline coincided with buyers moving away from tariff-free Australian coal toward discounted Russian and competitively priced US supply, showing that in a commodity market, price signals can outweigh preferential trade access.
Global Coking Coal Price Cycle and Supply Diversification
Coking coal is a globally traded commodity whose price is set by a small number of major exporters (principally Australia), making importing countries like India sensitive to international price cycles regardless of the currency value of their import bill. Diversifying supplier countries is a standard strategy to reduce this price-cycle exposure, though it does not eliminate it.
Key Details
- Following restrictions on some Russian commodity exports to Western markets after 2022, Russian coking coal became available to Indian buyers at a discount to benchmark international prices, encouraging Indian steelmakers to increase purchases from Russia
- The US has also emerged as a growing coking coal supplier to India in recent years, alongside Russia, reducing reliance on the traditionally dominant Australian supply
- A "low-price cycle" in global coking coal, alongside these sourcing shifts, is cited as a joint driver of the lower import bill
- Because India still imports the bulk of its coking coal requirement, a reversal of the current low-price cycle would directly raise input costs for domestic steelmakers, regardless of which countries supply the coal
This bridge explains why the article frames the falling bill as a benefit "helped by" favourable pricing and discounts rather than a structural improvement — the exposure to global price cycles that the National Steel Policy seeks to reduce through domestic output remains fully intact.
- India's coking coal import bill: $19.2 billion (FY23) to $11.76 billion (FY26) — a decline of about 39%
- National Steel Policy, 2017 target: cut coking coal import dependence from ~85% to ~65% by 2030-31
- Coking coal notified as a Critical and Strategic Mineral under the MMDR Act, 1957: January 2026
- India's coking coal resources: approximately 37.37 billion tonnes, concentrated in Jharkhand
- Mission Coking Coal domestic production target: ~140 million tonnes by FY30 (from ~66.8 million tonnes in FY24)
- India-Australia ECTA: signed April 2, 2022; entered into force December 29, 2022; eliminated tariffs on over 85% of Australia's exports to India by value