As the India-US bilateral trade deal nears formalisation—pushed aggressively by Washington—the former is expected to increase its energy commodities purchases from the latter, including buying more coal, particularly metallurgical—a key ingredient for the steel industry.
Washington accounted for more than 8 per cent of India’s cumulative coal imports in FY25, which industry players, analysts and government officials indicate could easily be topped up to 10 per cent.
However, a senior government official explained that freight costs from the US are higher compared to markets such as Australia, Indonesia, South Africa, or Russia (Far East).
“My sense is that any decision to buy more US coal would be largely driven by geopolitics, not economics. There is room to grow if we are considering expanding purchases with respect to the bilateral trade deal,” the official added.
In return, another source suggested that the world’s second largest coal consumer can reduce cargoes from Russia, which accounted for over 9.5 per cent of India’s coal imports in FY25.
In a September 2025 report, the US Energy Information Administration (EIA) said Russia offset the decreased coal exports to European markets by increasing shipments to Asia, mainly China, India, and South Korea. Russia’s exports to India increased in recent years, from about 8.3 mt in 2020 to about 22.5 mt in 2024.
India has been continuously increasing its energy trade with the US since 2025 after US President Donald Trump assumed office in January and started pressuring to reduce hydrocarbon trade with Russia. Rising shipments of various energy commodities, including coal, is a reflection of this narrative.
For instance, India imported 8.48 million tonnes (mt) coking coal from the US in FY25. During April-November period of FY26, it imported a little over 6 mt. Similarly, overall imports from Washington stood at 20.14 mt in FY25, while during 8M FY26 it was at 15.34 mt.
As per US EIA data, India’s thermal coal imports from the US have risen in the last five years. For instance, India imported 14.38 mt and 13.25 mt coal from the US in 2023 and 2024, respectively. This is the highest in more than a decade. Besides, India’s coal imports from the US averaged at 10.60 mt during 2020-2024 CY compared to an average of 6 mt during 2015-2019 CY.
The push for purchasing more coal comes at a time when the Coal Ministry has notified coking coal as a critical mineral.
Even though India holds the world’s fourth largest coal reserve, it does not have significant quantities of high quality coking coal, and imports almost 85 per cent of its overall requirement of the high grade commodity.
As the country plans to expand the steel manufacturing capacity aligning with Vikshit Bharat 2047 (developed economy), the requirement of coking coal is expected to appreciate significantly.
The world’s third largest energy consumer has upped purchases of crude oil, liquefied natural gas (LNG), propane, butane and coal from the US. Analysts point that passing of the SHANTI Act, which paves way for higher private sector participation in Nuclear energy will further push higher civil and commercial participation between New Delhi and Washington.
Washington is already New Delhi’s sixth largest energy trade partner with a value of $13.7 billion in FY25. In April-November of FY26, the value stood at $12.68 billion.
Published on February 5, 2026
