IAS Gyan

Daily News Analysis


30th March, 2024 Economy


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  • India's energy landscape is fraught with persistent electricity shortages, primarily stemming from burgeoning demand and logistical intricacies in coal distribution.
  • This discourse delves into the underlying factors contributing to electricity deficits and introduces inventive strategies to mitigate them effectively.

Understanding the Challenge:

Escalating Electricity Demand:

  • India's unabated quest for electricity, propelled by urbanization, population expansion, and economic growth, poses formidable challenges to its energy ecosystem.

Dispelling Coal Scarcity Myths:

  • Contrary to prevalent notions, the purported shortage of domestic thermal coal, pivotal for power generation, is often overstated.
  • Reported deficits, like the minor 55% shortfall in August 2023, belie the perception of acute scarcity, spotlighting misconceptions.

Confronting Logistical Complexities:

  • The crux of the matter lies in confronting intricate logistical hurdles in coal transit from mines to power plants.
  • Existing railway infrastructure, a linchpin in coal logistics, grapples with constraints hampering seamless supply chain management.

Mitigating Import Reliance:

  • Misinterpretation of policy directives has fostered an undue reliance on coal imports, exacerbating supply chain inefficiencies.
  • While the Ministry of Power advocates prudent coal stock monitoring and limited imports (up to 6% by weight), this counsel has been misconstrued as a mandate, fueling unnecessary expenditures.

Innovative Approaches:

Leveraging Indigenous Resources:

  • Unleashing the potential of domestic coal reservoirs through mechanisms like spot auctions by Coal India Ltd holds promise in alleviating supply shortfalls.
  • Encouraging power plants to prioritize domestic coal procurement, notwithstanding logistical challenges, holds the key to enhancing supply chain resilience.

Addressing Logistical Bottlenecks:

  • Strategic investments in infrastructure, particularly rail networks, are imperative to streamline coal transit routes.
  • By bolstering connectivity and optimizing logistics, India can fortify its coal supply chain, curbing import dependence and ensuring uninterrupted power generation.

Reinforcing Regulatory Oversight:

  • Strengthening regulatory supervision is crucial to incentivize power plants to adopt cost-effective procurement strategies.
  • Vigilant oversight of coal procurement practices by regulators can alleviate financial burdens on consumers and foster energy sustainability.

Insights from IEA Report 2024:

Persistent Coal Dependency:

  • Despite efforts to diversify energy sources, coal remains the linchpin of India's energy landscape, underscoring the urgency of accelerating renewable energy adoption.

Advancements in Renewable Energy:

  • Robust growth in renewable energy capacities, particularly solar and wind, underscores the imperative of expediting the transition to sustainable energy sources for long-term viability.

Charting the Path Forward:

Infrastructure Augmentation:

  • Prioritizing investments in infrastructure upgrades for coal transit networks is pivotal in bolstering supply chain resilience.
  • Enhancing rail connectivity and optimizing logistics hold the promise of mitigating supply disruptions and enhancing energy security.

Promoting Renewable Energy Transition:

  • Accelerating the shift towards renewable energy sources, such as solar and wind, is imperative for sustainable energy security.
  • Investments in renewable infrastructure and grid integration technologies are pivotal to reducing fossil fuel dependence and mitigating environmental impacts.


  • Effectively navigating India's electricity challenges necessitates a comprehensive approach, blending immediate logistical enhancements with long-term renewable energy imperatives.
  • By embracing sustainable practices and optimizing energy utilization, India can forge a resilient and sustainable power supply while advancing towards renewable energy objectives.
  • Pragmatic policy implementation, coupled with technological innovations, will be pivotal in navigating the intricacies of India's power sector and securing the nation's energy future.


Q. Evaluate the role of regulatory oversight in mitigating the over-reliance on coal imports and ensuring cost-effective procurement strategies in India's power sector.