National Situation

Report from Dhanbad Coal Fields

Coal Mining in India

We want to give a brief overview on the current scope of coal mining and consumption in India [2].

Coal mining in IndiaIn 2009, India (526 million tonnes) was the third biggest hard coal producer after China (2,971 Mt) and the USA (919Mt). 85 per cent of coal is produced by Coal India Limited (CIL), the world largest coal mining company, currently employing around 380,000 permanent workers and running around 500 mines in India.

Around 55 per cent of energy production in India stems from coal, compared to around 3 per cent from nuclear energy. Around 75 per cent of total coal stock is consumed by the energy sector. Global market prices for coking coal increased by 70 per cent during 2010 – the regime in India is forced to import coal for energy production and at the same time put more pressure on production costs ‘at home’.

Production costs in India are 35 per cent higher compared to Australia, Indonesia or South Africa, which is not due to higher wages, but lower out-put productivity. The Coal India Ltd. subsidiary SCCL claimed in 2010 that wage costs account for 44 per cent of total production costs. The average mechanised mine in India had an out-put of 3.8 tons per man-shift in 2008, while manual mines operate on levels of 0.4 tonnes. In comparison, the United Colliery in Australia reports to achieve an output per man shift of 65 tonnes. In order to increase productivity there is a shift towards large scale open pit mining. In 2005 around 80 per cent of coal production in India came from open-cast mining, this compares to 20 per cent in 1971. The underground production declined from 50.56 to 43.54 million tonnes during the period 2001 to 2008.

The imports of coal increased rapidly over the last three years, from 59 million tonnes in 2008-9 to 73 million tonnes in 2009-10 to 84 million tonnes in 2010-11. There is also a significant increase in direct investment of steel manufacturing companies from India in coal mining companies in the US, Africa and Australia, while CIL in turn outsources whole open-cast mines to international companies and companies previously only engaged in transport and logistics.

Total coal production in India

30 Mt
72 Mt
89 Mt
200 Mt (by Coal India Limited alone)
345 Mt (by Coal India Limited alone)
526 Mt (out of which 430 Mt by Coal India Limited)

Estimated official work-force before nationalisation


Permanent workers at CIL