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Sagarmala project aims to increase coal transportation through coastal route by 5 times by 2025

Implementation of sagarmala project will increase movement of coal through coastal route from 27 MTPA in FY 2016 to 129 MTPA by 2025 and increase the share of inland waterways and coastal shipping in modal mix to increase from 6% to 12%, according to Indian Government. The programme envisions reduction in the cost of power generation by Rs 0.50 per unit of power.

It is estimated that for power plants located 800 to 1,000 km away from coal mines, the cost of coal logistics can contribute up to 35% of the cost of power production. Particularly in the case of the Coastal power plants in Andhra Pradesh and Karnataka, that currently receive coal from Mahanadi Coalfields by Railways, significant savings can be achieved by taking coal through the rail-sea-rail (RSR) route. It is estimated that coastal movement of coal to these plants can result in annual savings of over INR 10,000 Crore to the power sector.

In addition, up to 50 Million tonnes of coal can be moved via coastal shipping for non-power thermal coal users (for example steel plants). Other commodities such as steel, cement, fertilizers, POL and food grains could also be moved via coastal shipping to the extent of about 80-85 MN tonnes by 2025. Additionally, an estimated 60 to 70 MN tones of cargo can also be moved over inland waterways (with focus on NW1, NW2,NW4 and NW5) by 2025.

 

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