India’s aluminium industry badly hit by coal shortage; urges PMO to ensure coal supply on priority

The Aluminium Association of India (AAI) said that non-power industries, including aluminium companies, has been “plagued” by a protracted coal shortage for the past seven months and urged the Prime Minister’s Office (PMO) to ensure on priority a supply of at least 25-30 coal rakes per day to the sector.

The Association warned that disruptions in the aluminium sector’s production will have a negative effect on India’s industrial landscape. To highlight the severity of the crisis, the AAI has written to the Prime Minister’s Office seeking an urgent and immediate resumption of coal supplies to ensure the survival of the domestic industry.

“As the most widely used non-ferrous metal globally and a critical input for several core industries in India, any disruptions in the sector’s production will undoubtedly have a negative effect across the country’s industrial landscape,” AAI wrote to the Prime Minister’s Office (PMO).

The continued coal shortage being faced by the country’s highly power-intensive aluminium industry has now put lakhs of jobs in jeopardy. “With CIL continuing to give unjustifiable priority to the power sector despite improvement in coal stocks, the supplies to the non-power sector have declined by a staggering 18.2 per cent in the last few months (September 2021-January 2022) compared to the same period last year,” the AAI said.

It added that during the same period, coal stocks for the power sector have improved by 20 per cent. According to industry bodies, in the absence of adequate coal supply by Coal India Ltd (CIL) and its subsidiaries, several aluminium plants in the country are staring at imminent closure. The aluminium industry and its allied small and medium enterprises (SMEs) in India provide jobs to lakhs of people. The aluminium industry requires an uninterrupted power supply through in-house CPPs operating round-the-clock for 365 days.

According to the AAI, the industry has invested over Rs 50,000 crore to set up CPPs (captive power plants) near the coal mine pit heads that are designed to operate on domestic coal grades from these mines.

Shekhar Ghosh is a communications consultant and and former journalist, who has edited and written for publications such as like Business India, Business Standard, Business Today and Outlook.

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