India is fast catching up with China in its thermal coal imports, as the world’s two biggest overseas buyers of the power generation fuel adjust purchases to align them with the varying trajectories of their economic growth. 

India, widely seen as one of the last remaining major growth markets for the fuel, has stepped up buying from Indonesia and Russia after the invasion of Ukraine, which Moscow calls a special operation. 

India’s thermal coal imports are expected to rise by 7 per cent on year to 158 million tonnes (mt) in 2022, and a further 3 per cent to 163 m in 2023, consultancy Wood Mackenzie (Woodmac) has said. 

In contrast, shipments of the fuel resource into China, the world’s biggest importer, could fall to 182 mt in 2022 and 176 mt in 2023, from 246 mt in 2021, Woodmac adds. 

Coronavirus lockdowns stifled demand for the fuel in China, while a steep rise in electricity demand triggered a spike in India’s imports. 

India’s economy recovered from weak consumer demand to grow at the fastest pace in a year in the June quarter. On the other hand, China narrowly avoided contracting in the second quarter and has grown at a tepid 2.5 per cent this year due to COVID-19 lockdowns in many parts of the country.