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A critical shortage of coal in India could cripple the nascent recovery of the Indian economy by disabling a number of sectors, especially manufacturing. Until Tata Power, a private power distribution company, sent text messages to its consumers recently, people in India had no idea that there was any issue about the availability of coal, which is used to generate around 70 percent of India's electricity.
Tata Power warned their consumers to use power judiciously, stoking fears of power outages. It was only after this that the mainstream media in India picked up the story.
But while Indian government officials assured people that any possible crisis would be averted, a number of provinces and regions started reporting power outages. The Indian government also explained that the current coal shortage has been caused by a number of factors including a sharp rise in demand occasioned by the economic recovery, transportation difficulties caused by heavy downpours and floods in some places, and a sharp rise in the prices of imported coal.
India, in fact, is the second-largest importer of coal. And coal prices have risen by up to 40 percent over the past two months, leading to Indian imports dropping to a two-year low at a time when demand has grown 17 percent compared with the same period in 2019-that is, before the COVID-19 pandemic broke out.
On Oct 10, in its official response to Tata Power's text messages, the Indian government went into complete denial. Indian power minister R.K. Singh rapped the company for "creating panic… unnecessarily" and warned distribution companies of stringent action if they resorted to rationing. Officials claimed that Coal India Limited, the Indian government-owned and largest coal producing company in the world, had reserves for 24 days and thermal plants had stocks for four days.
Yet on Oct 9, Singh had told an Indian newspaper that the situation was "touch and go" and that he was bracing for the next five or six months despite hoping that demand would start tapering off in the secon

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