Non-power utilities are set to be badly impacted by the revision in coal prices announced on Monday. Power consumers using inferior quality of coal would also be adversely affected.

Coal India Ltd. (CIL) had introduced a differential pricing policy in February 2011, whereby prices were increased by 30 per cent for that segment of coal consumers whose end-product prices were market driven.

“This hike (yesterday’s) is another dampener on the industries, and on the national economy at large, which is struggling for survival”, the Coal Consumers Association of India (CCAI) said. In tune with falling international prices, The CIL Board, on Monday, okayed a 12 per cent reduction in prices of two of its top grades ( which account for five per cent of its total output) while increasing the prices of all its lower grades by 10 per cent. “ The drastic decline in international coal price may neutralise the impact on the sectors using imported coal as an alternative source of fuel,” the association said. The price would vary between Rs. 400 per tonne and Rs. 4,420 per tonne for power utilities, and Rs. 540 per tonne and Rs 3,890 per tonne for non-power utilities following Monday’s hike.

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