Direct Coal Procurement by Neighboring Nations
State-owned Coal India Limited (CIL) has announced that from January 1, 2026, buyers from Bangladesh, Bhutan, and Nepal will be able to directly participate in its online coal auctions, bypassing Indian middlemen. This development aims to enhance the utilization of surplus coal resources and promote transparency.
Background
- Previously, coal access for these countries was only available via domestic traders without any end-use restrictions.
SWMA Auctions
The Single Window Mode Agnostic (SWMA) auction system, launched in 2022, integrates multiple auction platforms into one, simplifying the coal procurement process to be more transparent, easier, and market-driven.
Benefits of the New System
- Enhances transparency and competition.
- Facilitates market expansion while ensuring domestic coal needs are met.
- Promotes global market integration.
Operational and Procedural Modalities for Foreign Buyers
- Foreign buyers can now participate alongside domestic buyers in SWMA auctions.
- Includes features like one-time registration, digital bidding, and advanced electronic payments.
- Exports facilitated through notified logistics channels.
- Payment processes governed by Foreign Exchange Management Act (FEMA) rules.
- Payment in INR or US dollars for Nepal, and US dollars (valued in INR) for Bangladesh and Bhutan.
Strategic Steps
CIL engaged in dialogues with prospective overseas coal consumers to tailor the framework according to their needs, ensuring the scheme's effectiveness and market alignment.
