India's thermal coal imports drop to four-year low

India's thermal coal imports fell to a four-year low in the first five months of 2026 as higher domestic coal production and rapid growth in renewable energy generation reduced demand for overseas supplies, commodities consultancy BigMint said.

Thermal coal imports totaled 65 million metric tons in January-May, down 12% from the same period a year earlier, according to the consultancy.

India, the world's second-largest importer of thermal coal, has been seeking to reduce its dependence on imports and aims to cut the use of imported coal for power generation by at least 30% this year.

State-owned Coal India had earlier directed its subsidiaries to ramp up production as scorching temperatures linked to the El Nino weather pattern boosted electricity consumption across the country.

Higher imported coal prices and elevated freight costs resulting from disruptions linked to the Middle East crisis also weighed on imports, BigMint said.

India's total power generation rose 5% year-on-year in January-May, while renewable energy generation increased at a much faster pace of 22%, according to the consultancy.

The country's peak power demand, a measure of maximum electricity requirement, exceeded the government's projection of 270 gigawatts on May 21 as heat waves swept across large parts of the country.

Power demand in the South Asian nation climbed 11.2% in May from a year earlier to its highest level in two years, according to data from federal grid operator Grid-India.

Thermal power generation rose 10% year-on-year during the month, the strongest increase since May 2024, as utilities ramped up output to meet round-the-clock electricity demand, Grid-India data showed.

Renewable power generation increased 29.3% from a year earlier to 27.58 billion kilowatt-hours in May, accounting for a record 17.9% of India's electricity mix, according to a Reuters analysis of daily government data.

Editing by Reiner Simanjuntak