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New Delhi: In a first, state-run Coal India Ltd (CIL) has sent 4,000 tonnes of coal to Bangladesh for its Khulna power project, as part of India’s strategy to play a key role in creating a new energy security architecture for its neighbours.

The 1,320 megawatts (MW) Khulna project has been built recently in a joint venture by India’s NTPC Ltd and Bangladesh Power Development Board (BPDB).

This comes in the backdrop of CIL lifting the embargo on coal exports under its e-auction sales policy. Now coal purchasers, including traders, can export the coal bought through this route. This assumes significance given that CIL is India’s largest coal miner, with the allocation under spot e-auction and special spot e-auction accounting for 46 million tonnes (mt) of coal in FY21.

“In less than a month of Coal India Limited (CIL) tweaking its e-auction coal sale policy, lifting the restriction on export of its coal procured by domestic coal purchasers under two e-auction windows, the first coal laden rake left for Bangladesh on 2 July. One rake of coal consists around 4,000 tonnes. This is for the first time that coal was exported after the policy amendment," CIL said in a statement on Monday.

India has been supplying electricity to Bangladesh, with the power-starved neighbouring country exploring all options including wheeling power from projects being set up in India across the fuel sources including solar to help meet its energy demands.

“The destination of below 2200 gross calorific value coal purchased under spot e-auction from Dahibari siding of Bharat Coking Coal Limited (BCCL), the Jharkhand based coal producing subsidiary of CIL is Rampal Power Station, Khulna, Bangladesh. This falls under Maitree Super Thermal Power Project - a joint venture between the Indian power producer NTPC Limited and Bangladesh Power Development Board," the statement added.

Cross-border energy trade is a key part of PM Narendra Modi’s South Asia-focused neighbourhood-first policy. The government has set up a high-level group headed by former Union power secretary Ram Vinay Shahi and tasked it with helping build a South Asia-focused energy security architecture, as reported by Mint earlier. India and Bangladesh already have a power transmission link, that is helping meet electricity demand in Bangladesh.

“The Bangladesh bound coal left the Indian shore from Syama Prasad Mookerjee Port, Kolkata, the sea route which links India and Bangladesh," the statement said.

Speaking at Mint’s annual energy conclave in March last year, power and new and renewable energy minister Raj Kumar Singh had said it is his aim to have a regional power grid that includes Myanmar, Bhutan, Bangladesh, Nepal and Sri Lanka. The proposed market, which will include these countries, could aid regional peace and improve utilization of generation assets—including the stranded assets in India—and efficient price discovery. India is already moving ahead with its ambitious global electricity grid plans to roll out a “One Sun, One World, One Grid" (OSOWOG).

CIL is India’ largest coal miner with a coal production target of 670 mt for the current financial year. India’s overall coal requirement is expected to go up to 1,123 mt by 2023 from the present level of 700 mt.

“For April-June’21 quarter CIL has allocated 6.7 million tonnes (MTs) of coal under spot e-auction which is nearly one-fourth of the entire booked quantity of 27.3 MTs, fetching the company 30% add-on over the notified price. For the comparable period last year, the add-on was 16% under spot e-auction," the CIL statement said.

With global shift to green energy to address growing environmental concerns, the Indian government is pulling out all stops to harness coal reserves within the next three decades. India has the world’s fourth largest reserves and is the second-largest producer of coal.

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