India will overtake China and become the largest importer of coal in the world in 2012, reported by Bloomberg, citing research analysts from Citigroup. India’s purchases of coal from abroad this year will amount to 118 million tons compared to 102 million tons in China.
The reason for the growth of imports is a sharp increase in demand for coal in India. Most of the country’s electricity is produced by burning coal. Meanwhile, its production did not keep pace with consumption.
Economic growth in India in the third quarter of 2011 fell to a minimum of two years, since the country experienced electricity shortages. At the same time, due to lack of raw materials, it’s difficult to increase the capacity of the State and local businesses.
India’s largest energy companies, including Reliance Power and Adani Power, have already cut down plans to expand capacity. The program of building power plants in the total value of $ 36 billion has been suspended.
At the same time, power consumption in China also increased , parallel to the rapidly increasing production of coal. In 2012, China will increase production by 200 million tons – twice more than a year earlier. In this regard, coal imports into China will be reduced by 40 million tons.
In 2011, China led the world list of importers of coal, overtaking Japan, which had been in first place since 1975. Energy consumption in the second-largest economy in the world increased last year by 12 percent.