India asks utilities to import coal, warns states not to sell power on exchanges

Bengaluru: India has asked power producers to import up to 10% of their coal needs amid fuel shortages and has warned states that federal companies will curb their power supplies if they are found selling electricity on power exchanges to cash in on surging prices.

India is the world's second-largest coal producer, with the world's fourth-largest reserves, but a steep surge in power demand that has outstripped pre-pandemic levels means state-run Coal India's supplies are no longer enough.

Increased economic activity after the second wave of the coronavirus pandemic has driven up demand for coal leading to a supply shortage, forcing north Indian states like Bihar, Rajasthan and Jharkhand to undertake power cuts for up to 14 hours a day.