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As India’s demand for coal and oil increases, Russia steps in to become a key supplier. This article delves into how Russia is catering to the energy needs of the fast-growing Indian economy.
India imported over 176 million metric tons of thermal coal from Russia (Pic: Depositphotos)
Mumbai: Russia is ramping up its coal production to cater to India’s growing energy demands. According to Russian Deputy Prime Minister Alexander Novak, this increase in production will help fulfil the coal-based requirements of the Indian economy. India, which relies heavily on coal for power production, has seen an unprecedented rise in coal consumption. In 2019, for the first time, power production from coal surpassed that from renewable sources, and by 2023, over 75 per cent of India’s power generation came from coal.
China remains the world’s largest consumer of coal, but Russian forecasts indicate that India is set to overtake China as Beijing transitions towards cleaner energy sources for its production processes. India’s reliance on coal continues to grow, with the country using more coal than ever before. This rising consumption is a key reason why Russia is focusing on expanding its coal exports to India.
India’s Rising Coal Demand
Last year, India imported over 176 million metric tons of thermal coal from Russia, marking a significant jump from the previous year. Russian energy ministry data also shows that India purchased 26.2 million tons of coal in 2023, a notable increase from 20 million tons in 2022. This deepening trade relationship underscores the importance of Russia as a vital energy supplier to India, particularly as Europe has diversified its imports away from Russia in the wake of the Ukraine conflict.
Beyond coal, Russia has also become India’s largest supplier of crude oil, saving India billions of dollars in foreign exchange on oil trade. With Europe scaling back its imports from Russia, the Russian oil and coal industries are increasingly looking towards fast-growing markets like India. As India’s economy expands, so too does the purchasing power of its population, further fuelling demand for energy resources like coal and oil.
Russia’s abundant energy resources, combined with India’s growing appetite for coal and oil, create a mutually beneficial trade dynamic. As the Indian economy continues to evolve, this partnership is expected to deepen, with Russia playing a crucial role in meeting India’s future energy needs.
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