Coal India Gains from Tax Overhaul
September’s GST restructuring delivered unexpected relief for India’s coal sector. While raising the base rate from 5% to 18%, the government eliminated a ₹400 per tonne cess, creating a net reduction of ₹180 per tonne from September 22.
Coal India, which supplies 80% of domestic production, stands to benefit most from improved price competitiveness against imports. The state miner produced 703mn tonnes in FY2024 while India imported 261mn tonnes, primarily higher-grade coal for steel production and thermal generation.
The reform reflects New Delhi’s balancing act between climate commitments and energy security. Coal still generates 70% of India’s electricity, and demand continues rising alongside industrial expansion. Rather than accelerating coal’s decline, the government chose to ...
