Coal India FY26 capex: ₹16,000 crore, 8 washeries by 2030

What Coal India has announced for FY2025-26

Coal India Ltd (CIL) has outlined a capital expenditure plan of ₹16,000 crore for FY2025-26, focusing on production support, coal quality improvement, and diversification into renewable energy. The company’s plan includes investments across logistics, land, equipment, and projects such as washeries and solar. Alongside its coal roadmap, CIL has also reiterated longer-term clean energy targets, including building a large solar portfolio. The capex outline comes even as coal demand was described as sluggish in the first quarter of FY2025-26, according to a PTI report datelined Kolkata.

The biggest spend: transportation and evacuation infrastructure

A key part of the FY26 capex is aimed at moving coal faster and more reliably from mines to consumers. CIL has earmarked ₹5,622 crore, about 35% of the total FY26 capex, for transportation and evacuation infrastructure. This includes rail sidings, corridors, coal handling plants, silos and roads. The company is pressing ahead with these plans under its capex programme in FY26, according to PTI.

CIL’s investment in evacuation is also linked to its “first mile connectivity” push. An official told PTI that the investments are meant to ramp up mechanised coal evacuation capacity from 151 million tonnes per annum (MTPA) to 994 MTPA by FY2028-29. The scale of this target highlights the centrality of logistics to the company’s medium-term volume ambitions.

Capex split: land, equipment, washeries and other projects

Apart from logistics, land acquisition remains a major item for mining expansion. For FY26, CIL has allocated ₹2,382 crore for land acquisition. Another ₹1,952 crore is allocated for heavy earth-moving equipment, new washeries, and other plant and machinery. The remainder is meant for mine development, solar projects, joint ventures, and pithead power plants.

Eight new coking coal washeries: ₹3,300 crore plan to FY2030

Within the wider capex and quality improvement agenda, CIL has planned a ₹3,300 crore investment to establish eight new coking coal washeries by FY2030. The company’s stated objective is to reduce India’s dependence on imported coking coal, which is a key raw material for the steel industry. Domestic coking coal typically has high ash content, and the washeries are aimed at addressing this quality constraint.

The eight new washeries will have a combined annual capacity of 21.5 million tonnes per year (MTY). The project is slated for completion by FY2030 and is positioned as a step to improve the quality of coal supplied to the domestic steel sector.

Where the washeries will be built: CCL and BCCL

CIL’s planned washery capacity is split between two subsidiaries. Central Coalfields Ltd (CCL) will develop five washeries with a total capacity of 14.5 MTY. Bharat Coking Coal Ltd (BCCL) will establish three units with a capacity of 7 MTY. This distribution indicates that the new capacity is being built around existing coking coal operating regions and subsidiaries.

In addition to greenfield additions, CIL will allocate around ₹300 crore towards renovation and modernisation of its existing washeries. The intent is to improve operational efficiency and utilisation at current facilities, alongside adding fresh capacity.

Coal supply and production goals: FY26 target and the 1-billion-tonne roadmap

For FY26, CIL has set a coal supply target of 900.24 million tonnes (MT), which it described as an 18% increase from the previous year. The power sector is projected to be the largest consumer, with expected demand of 668.1 MT, around 74% of the total dispatch target. Separately, one report also stated that CIL was tasked with an offtake target of 900.24 MT for FY2025-26, compared with 762.98 MT achieved in FY2024-25.

On production, CIL has reiterated that it is on track to reach 1 billion tonnes by FY2028-29. The company also reported its highest ever production volume of about 781.06 million tonnes in FY2024-25 and described a roadmap to reach 1 billion tonnes by FY2028-29. Another section in the provided material separately referred to an ambition of achieving 1 billion tonne of production by FY2025-26. The company has also said production levels will ultimately be aligned with demand trends.

Solar and renewables: spending momentum and medium-term targets

CIL’s capex plan includes a growing renewable energy component. Capital expenditure on solar projects reached ₹961 crore as of January FY26, a 2.33-fold increase from the previous year. This exceeded the progressive target of ₹729 crore and also surpassed the full-year solar capex target of ₹957 crore for FY26.

On operating capacity, CIL commissioned 114 MW of solar capacity in FY2024-25. This took its cumulative installed solar capacity to 209.08 MW as of March 2025, according to the PTI report. CIL has set a longer-term goal of installing 3,000 MW (3 GW) of renewable solar capacity by FY27-28 or FY28 under its decarbonisation and net-zero roadmap. The provided material also states that the company intends to ramp up renewable capacity by another 6.5 GW by FY2029-30.

What this means for steel, power, and energy security

The coking coal washery push is directly relevant for the domestic steel value chain because washeries are aimed at improving coal quality by reducing ash content. If executed as planned by FY2030, the additional 21.5 MTY capacity is meant to increase the availability of washed coking coal for steel producers and reduce reliance on imports.

For the power sector, which is projected to take 668.1 MT of the FY26 dispatch target, logistics and evacuation investments are central to reliability. Rail corridors, sidings, and coal handling plants are intended to ease bottlenecks between pithead and consumption centres. CIL’s evacuation ramp-up target to 994 MTPA by FY2028-29 under first mile connectivity is part of this broader operational reliability effort.

Why the FY26 capex plan matters

CIL’s FY26 capex combines near-term needs of coal movement and mine expansion with medium-term quality improvements and renewables. The ₹16,000 crore FY26 plan is also described as part of a larger investment intent, including a plan to invest over ₹50,000 crore over the next three years. Separately, CIL’s CMD has also been quoted saying the company expects capex of at least ₹80,000 crore over the next five years.

The plan’s structure shows that logistics and evacuation have been prioritised within FY26 allocations, while quality upgrades like washeries and energy transition initiatives like solar are being funded alongside. CIL’s targets, ranging from 900.24 MT supply in FY26 to a 1-billion-tonne production roadmap, sit alongside renewable goals, suggesting the company is trying to run two parallel tracks: sustaining coal supply while building non-coal capacity over time.

Conclusion

Coal India’s ₹16,000 crore FY26 capex plan places the largest allocation on transportation and evacuation, while also backing coal quality projects like eight new coking coal washeries by FY2030 and scaling solar investments. The company has set a FY26 coal supply target of 900.24 MT, with the power sector expected to account for 668.1 MT of demand, and it has reiterated a 1-billion-tonne production milestone by FY2028-29. Over the next few years, execution milestones will be tracked through progress on first mile connectivity capacity expansion, commissioning of washery capacity, and the pace of solar additions toward the 3 GW target.