Coal India Ltd (CIL) has revealed a comprehensive strategy aimed at phasing out the import of heavy-duty mining equipment within the span of six years. This initiative is set to generate significant savings of Rs 1,000 crore annually on customs duty, which is currently incurred due to the import of high-capacity gears.

Presently, CIL procures a portion of its mining gear from domestic manufacturers; however, it heavily relies on imported high-capacity equipment, resulting in a substantial customs duty expense of Rs 1,000 crore, in addition to the Rs 3,500 crore spent on import procurement.

The roadmap proposed by an interdisciplinary committee under CIL's director (technical) outlines various pivotal steps. Initially, there's a focus on incorporating tender clauses to incentivize the utilization of indigenous equipment. This will be supplemented by an incentivization scheme aimed at encouraging manufacturers to design, develop, and produce equipment within India, aligning with the 'Make in India' initiative.

Standardization of equipment, an ongoing process at CIL, is also a key aspect of the roadmap. This standardized approach is intended to extend to captive miners and others, thereby creating a robust demand for domestically manufactured equipment.

Furthermore, the committee emphasizes the manufacturing of critical components such as engines, differentials, transmission systems, and motors, aimed at enhancing spare part supply. The objective is to minimize repair duration and enhance machinery availability, as imported equipment often encounter prolonged downtime due to unavailability of spares.

Anticipating a substantial demand surge in heavy mining and earth-moving equipment over the next decade, the committee underscores the importance of this strategic shift. Considering coal's projected long-term dominance as a primary energy source even beyond 2030, the demand for such equipment is expected to remain robust.

Representatives from various key entities such as ministries of heavy industries and railways, coal mining companies, power utilities, leading equipment manufacturers, and industry associations contributed to the formulation of this strategic plan.