India: Import of coal needs mandatory registration under CIMS

The Indian government has now made it mandatory for coal importers to register themselves under CIMS (Coal Import Monitoring System) starting 1 Feb ’21.

Coal commodities brought under this provision include anthracite, bituminous, coking, steam and other grade of coal as mentioned in the chapter 27 of foreign trade policy.

How it will work?

Under CIMS, importers have to submit advance information through an online system and obtain an automatic registration number valid for 75 days by paying a fee of INR 1 per thousand, subjected to a minimum of INR 500 and maximum of INR 1 Lakh on CIF value.

The registration made mandatory for imports are to be placed not earlier than 60th day and not later than 16th day before the expected date of arrival of import consignment.

Notably, a similar system of SIMS (Steel Import Monitoring System) has also been launched by the government for steel imports in Nov ’19.

The agenda behind

The CIMS data will give details of the importers and products registered for imports, total quantity being imported and even import quantity of those grades that are available domestically. The data, will thus help the domestic industry to chalk out their strategies for substituting imports.

The concern

Indian end-users in cement, sponge, and power sector rely heavily on imported coal. While the government has been making efforts since past few years to promote usage of domestic coal, the main concern from the end-segment was poor quality and low calorific value of domestic coal.

With this mechanism of CIMS in place, Indian government would be able to understand the requirement of the users more clearly and would be able to fulfill their requirement. This in turn would affect the business and revenues of importers in the long run.

During Jan-Nov ’20 India has imported about 207.26 mn t of coal, down by 12% y-o-y basis, according to the data maintained with CoalMint. The coal imports in India have dropped this year due to COVID-led lowered demand and also because of increased availability of domestic coal via auctions.