Coal Imports to India: HS 2701 Duty & Landed Cost
Coal HS code 2701 (anthracite, coking, bituminous). India tariff rates, import duty, CBIC rules, GAR/NAR specs, landed cost example. Calculate your all-in import cost.
Importing Coal to India: Tariff, Duty & Compliance Guide
India is one of the world's largest coal importers, with imports exceeding 100 MT annually. Coal is classified under HS code 2701, with India-specific duty rates and customs procedures managed by the CBIC (Central Board of Indirect Taxes & Customs). This guide covers coal tariff rates, landed cost calculation, quality specs, and compliance requirements.
- HS Code: 2701 (coal, lignite, peat)
- Current Import Duty: 0% (nil) as of 2026 for coking coal; 0–5% for thermal coal (commodity-dependent)
- Applicable GST: 5% (Integrated GST on CIF + duty)
- Quality Standard: ISO 3082 (coal sampling & analysis); GAR/NAR specifications per contract
- Ports of Entry: Chennai, Visakhapatnam, Paradip, Kandla, Nhava Sheva (Mumbai)
- Typical Landed Cost: CIF + 0–5% duty + 5% IGST + port fees + broker fees + inland transport
HS Code Breakdown: 2701 Coal & Lignite
| HS Code | Description | India Duty (2026) | Typical Use |
|---|---|---|---|
| 2701.11 | Anthracite coal (hard coal, high carbon) | 0% | Specialty fuel, metallurgical use |
| 2701.12 | Coking coal (bituminous, suitable for coking) | 0% | Steel production (majority of India imports) |
| 2701.19 | Other bituminous coal (thermal/steam coal) | 0–5% | Power generation, industrial heat |
| 2701.20 | Sub-bituminous coal (lignite-like, lower calorific) | 5% | Thermal power, lower-grade fuel |
Note: India's coal duty rates are commodity-specific and subject to change. Check the latest CBIC tariff schedule before importing. Coking coal (2701.12) typically enters at 0% duty due to India's steel industry dependency.
Calculating Landed Cost: Coal Import to India
Numerical Example: Real Example: 5,000 MT Coking Coal CIF India
Breakdown: CIF USD 450k + IGST USD 22.5k + Port/Broker USD 6.3k + Inland Transport USD 3–8k. Final per-MT cost depends on port chosen and inland distance. Use Landed Cost Calculator for precise estimates.
Quality Specifications: Coal GAR/NAR for India Imports
Coal quality is measured in two ways for India imports: GAR (Gross As Received) and NAR (Net As Received). Contracts typically specify GAR minimum (more conservative). India power plants and steel mills typically require:
| Quality Parameter | Typical Spec (Thermal) | Typical Spec (Coking) | Standard |
|---|---|---|---|
| Calorific Value (GAR) | 5,800–6,200 kcal/kg | 6,400–7,000 kcal/kg | ISO 3082 |
| Ash Content (ADB) | 12–18% | 10–14% | Air-Dried Basis |
| Sulfur Content (ADB) | 0.5–1.0% | 0.3–0.6% | Environmental limit |
| Volatile Matter (ADB) | 20–25% | 23–30% (coking grade) | ISO 3082 |
Quality Risk: If outturn inspection (at discharge) shows coal below contract GAR, buyer can claim price adjustment or reject. Use the Quality Adjustment Tool to calculate the financial impact of quality discrepancies.
Compliance Checklist: Coal Import to India
- HS Classification: Confirm HS code 2701.11, 2701.12, or 2701.19 with customs broker before shipment. Wrong code can trigger audit/reclassification.
- Pre-Shipment Inspection (PSI): Hire SGS, BV, or Intertek to test coal at load port per ISO 3082. Certificate proves quality compliance at loading.
- Bill of Lading (B/L): Ensure B/L lists HS code 2701.xx, commodity description ("Coal, bituminous, coking grade"), and quantity in MT.
- Commercial Invoice: Include CIF value, HS code, quality specs (GAR/NAR/ash/sulfur), and seller's name & address (India Customs requirement).
- Import License: If required by CBIC for specific coal types (check latest policy). Most thermal coal imports are open; coking coal may have quota/license.
- Port Entry: Use major coal import ports: Chennai, Visakhapatnam, Paradip, Kandla, Nhava Sheva. These have the best coal terminal infrastructure.
- Outturn Inspection: Independent inspection at discharge port confirms quality. If below contract spec, file claim within 30 days.
- Customs Clearance: Broker submits Bill of Entry (import document) with supporting docs. Customs examination typically 1–3 days; clearance 1–2 days thereafter.
- IGST Payment: At port, pay 5% IGST on (CIF + duty). If registered under GST, may be recoverable as input credit.
- Documentation Retention: Keep all inspection certificates, invoices, B/Ls for 5+ years for customs audit purposes.
Ports of Import: Port-Specific Duties & Demurrage
| Port | Location | Coal Terminal | Demurrage / Port Charge | Distance to Steel Plants |
|---|---|---|---|---|
| Visakhapatnam (Vizag) | Andhra Pradesh (east coast) | Yes (dedicated bulk berth) | USD 3,000–5,000/day delay | Close to JSW, JSPL steel mills |
| Paradip | Odisha (east coast) | Yes (major coal hub) | USD 2,500–4,000/day delay | Close to SAIL, Rourkela steel plant |
| Chennai | Tamil Nadu (southeast) | Limited; multipurpose | USD 2,000–3,500/day delay | Inland transport to north industrial zone |
| Kandla | Gujarat (west coast) | Limited; mainly breakbulk | USD 1,500–2,500/day delay | Distance to plants (high transport cost) |
| Nhava Sheva (Mumbai) | Maharashtra (west coast) | Limited for bulk coal | USD 2,000–3,000/day delay | General container port; avoid for coal |
Recommendation: Visakhapatnam and Paradip are the best-equipped for coal imports (dedicated berths, lower delays). Chennai and Kandla are alternatives but may incur higher demurrage if delayed. Avoid Nhava Sheva (Mumbai) for bulk coal-designed for containers, not coal.
Frequently Asked Questions
Q: What is the current import duty on coal in India (2026)?
A: Coking coal (HS 2701.12): 0%. Thermal coal (HS 2701.19): 0–5% depending on commodity type and policy. Check the latest CBIC tariff schedule before importing. Duty rates may change with government policy.
Q: Do I need an import license for coal in India?
A: As of 2026, most coal imports are under Open General Licensing (OGL), meaning no import license required. However, check CBIC and DGFT (Directorate General of Foreign Trade) websites for any commodity-specific restrictions or quotas on coking vs thermal coal.
Q: What is the landed cost per MT for coal imported to India?
A: Typical landed cost: CIF + 0–5% duty + 5% IGST + USD 3–5/MT port/broker/transport fees. For USD 90/MT CIF coal, total landed cost ~USD 96–98/MT. Use the Landed Cost Calculator for precise estimates based on your port and commodity grade.
Q: How long does customs clearance take in India ports?
A: Standard: 3–5 days (1 day examination, 1–2 days customs, 1 day release). With delays/questions: 5–10 days. Major ports (Vizag, Paradip) are faster than smaller ports. Demurrage starts after free demurrage period (typically 5–7 days); budget USD 2,500–5,000/day if delayed.
Q: Can I claim GST credit on coal imports?
A: If you're registered under GST and coal is used for eligible purposes (industrial fuel, steel production), you may claim input GST credit. Consult a GST specialist to confirm eligibility. If not eligible, IGST is a cost.
This guide is for trade education. Always verify current tariff rates, duties, and import regulations with the CBIC and a qualified customs broker before importing. India's trade policy changes frequently; this guide reflects 2026 policy based on publicly available data.