February 6, 2026 - India is likely to increase imports of coking coal—used mainly in steel and cement production—from the US in a bid to enhance energy partnership, as part of a trade deal between the two countries, said two people aware of the development.

India is the largest buyer of US coal globally. Coking or metallurgical coal accounted for more than 40% of the total 20 million tonnes (mt) of coal imported by India from the US in FY25, according to coal ministry data.

India has the fourth-largest coal reserves in the world, but it does not have significant reserves of high-quality coking coal, prompting it to import 85% of its overall requirement. With plans to expand the domestic steel manufacturing capacity, India’s coking coal requirement is set to grow further.

"India is import-dependent for coking coal, and diversification is needed for its sourcing. Imports from the US have been increasing of late and it would increase further. Although thermal coal is also imported from the US, coking coal would get further boost as India is increasing its domestic coal stocks for thermal usage," said the first of the two people cited earlier, both of whom spoke on the condition of anonymity.

With exports of 24.58 mt in FY25, Australia is the largest supplier of coking coal to India, followed by the US, which had supplied 8.48 mt. The other top suppliers include Russia (8.21 mt), Singapore (5.69 mt) and Mozambique (3.43 mt).

India's coking coal requirement in FY25 was 87 mt.

Data from the Union ministry of coal showed that during the ongoing financial year (FY26), as of November, the US has already supplied 6.04 mt of coking coal.

India is the world's second largest steel manufacturer with a capacity of about 205 million tonnes per annum (mtpa). Government aims to take it to 300 mtpa by 2030-31 and 500 mtpa by 2047.

The coal ministry did not respond to queries on the possibility of an increase in imports from the US. The ministries of commerce and external affairs also did not respond to Mint's queries till press time.

In response to an emailed query, a spokesperson for the US embassy in New Delhi referred Mint to a 2 February post by US President Donald Trump on Truth Social.

Citing his post, the spokesperson said: "In the announcement, President Trump shared that India committed to buy over $500 billion of US products, including coal. I don't have further specifics to share at this time."

The US has agreed to lower the reciprocal tariff on India to 18% from 25%, and remove the additional 25% duty to punish India's purchases of Russian oil.

On 2 February, a phone call between Prime Minister Narendra Modi and US President Donald Trump sealed the long-pending trade deal between Indian and the US.

"The consideration to scale up coking coal imports from the US is a pragmatic move rooted in supply security rather than substitution. With domestic coking coal constraints and an aggressive steel capacity expansion underway, diversifying sourcing beyond Australia reduces concentration risk and strengthens resilience," Rajamani Krishnamurti, president, Indian Stainless Steel Development Association (ISSDA), an lobby group, said. "The US partnership fits well into India’s long-term energy strategy, balancing reliability, quality, and geopolitics, while ensuring that growth ambitions in steel are not constrained by raw material bottlenecks."

Recently, addressing the Indian Energy Week, Vikram Dev Dutt, secretary in the ministry of coal, had said that India sees potential for importing more coal from the US, as the country is looking at increasing its steel manufacturing capacity. Representatives of both the countries held discussions on the same during the 4-day event (27-30 January), Reuters reported on 29 January, citing Dutt.

The development also comes days after India notified coking coal as a critical mineral.

Vinayak Vipul, partner, EY-Parthenon India, said: "With steel capacity expansion firmly embedded in national policy and blast furnace–based production expected to dominate, with more than 60% of Indian steel production expected to come from BF–BOF (blast furnace-basic oxygen furnace) route up till 2040, increasing supplies from the US also helps diversify sourcing away from heavy reliance on Australia, reducing exposure to supply disruptions and extreme price volatility. The shift towards higher contribution of US coking coal facilitates enhanced blending flexibility for Indian coke makers, leveraging the differing volatility and impurity profiles of US coking coal."

A.S. Firoz, former chief economist at the steel ministry’s economic research unit, however, cautioned that sourcing the mineral from the US would be costlier, including elevated freight expenses.

"Even the freight from the US is higher. But, India being an import dependent country, steel producers in particular need to maintain a strategic balance in procuring such an important raw material for the industry not to rely on single or limited source. Overall, unless the US coal prices are maintained at lower prices, the Indian steelmakers will see their costs go up.

Also, US coking coal has relatively higher sulphur and phosphorus content, compared to the premium grades from Australia, Firoz added. High sulphur and phosphorus content in coal carries through into steel, making it brittle and weakening its quality.