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The government has moved to treat coking coal as a strategic mineral, a step meant to push more mining at home and cut India’s dependence on imports for steel production. The change brings coking coal under the mining law, making it easier to clear projects and attract private players, at a time when steelmakers rely heavily on overseas supplies of the key raw material.

The notification comes amid growing concern over India’s exposure to global supply disruptions and price volatility in coking coal, an essential input for blast furnace based steel production. Officials said the move is part of broader structural reforms in the mining sector and aligns with the long term vision of Aatmanirbhar Bharat and Viksit Bharat 2047.

Coking coal is essential for making steel, and there are no real large-scale alternatives available today.

Yet, despite being one of the world’s largest coal producers, the country still relies heavily on imported coking coal. Having coal reserves on paper has not meant enough coal in reality. Domestic production has failed to match the pace at which steelmakers need the raw material, leaving little choice but to turn to overseas suppliers. That dependence has only grown with time, with coking coal imports rising steadily from around 51 million tonnes in 2020–21 to close to 58 million tonnes by 2024–25.

To put the decision into action, the Centre has amended the First Schedule of the MMDR Act. Coal has been redefined to clearly include coking coal, which has now been formally added to the list of critical and strategic minerals.

This status is meant to cut through red tape. Projects involving critical minerals get faster approvals, are exempt from public consultation norms, and are allowed to use degraded forest land for compensatory afforestation - all of which could help mining move ahead more quickly. These measures are aimed at accelerating exploration and mining activities, including the development of deep seated deposits.

The government said the reform will improve ease of doing business and encourage private sector participation in coking coal mining.

The Centre has clarified that the change will not affect the financial interests of states. Royalty, auction premium and other statutory payments related to mining leases will continue to accrue to the respective state governments, even where mineral auctions are conducted by the Central Government.

The move is in line with what the Economic Survey has been pointing out for some time. Coal, it said, still sits at the centre of India’s energy system and remains the backbone of power generation across the country.

The Survey also drew attention to the steel sector’s heavy reliance on imported coking coal, warning that this dependence leaves producers exposed to global price swings and supply disruptions. Boosting domestic output, it argued, is essential to reduce those risks and secure long-term supply. The Ministry of Coal had earlier launched Mission Coking Coal to significantly enhance domestic raw coking coal output by the end of the decade.