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Source– This post “National Coal Index” is based on the article”National Coal Index Increases by 3.83 points in September” published in “PIB” on 7th November 2023.
Why in News?
The National Coal Index (NCI) has increased first time since April 2023.
What is National Coal Index?
| Specification | Details |
| Started in | 4th June 2020 |
| Started by | Ministry of Coal |
| Other participating Institutions | The concept and design of the Index have been developed by the Indian Statistical Institute, Kolkata. |
| Objective | It is a price index(released monthly) which reflects the change of price level of coal in a particular month relative to the fixed base year. |
| Base Year | The base year for the NCI is Financial Year 2017-18 |
| Components | Composed of five sub-indices: (a) Three for Non-Coking Coal-The three sub-indices for Non Coking Coal are combined to arrive at the Index for Non Coking Coal. (b) Two for Coking Coal-Two sub-indices for Coking Coal are combined to arrive at the Index for Coking Coal. |
| Compilation Parameters | (1) Prices of coal from all the sales channels of coal(Notified Prices, Auction Prices and Import Prices) are taken into account for compiling the NCI. (2) The amount of revenue share per tonne of coal produced from auctioned blocks would be calculated by means of defined formula. |
| Who notified the prices? | (1) Non-Coking coal – Coal India Limited fixes notified prices for each grade (uniform for both regulated and non regulated sector). (2) Coking Coal – Subsidiaries of Coal India Limited notified the prices. |
| Benefits | (1) The Coal Index is the base indicator for the purpose of taxation. (2) This Index will be helpful For future calculation of upfront amount and intrinsic value of mine. (3) This index can be basis for calculation of annual escalation (monthly payment). |
What does the upward movement of the National Coal index indicates?
(1) It indicates rising demand of coal because of upcoming festive season and winter in the country.
(2) It will encourage coal producer to take maximum benefit by further scaling-up domestic coal production to meet the growing energy demands.
UPSC Syllabus- Indian Economy (Reports & Index)
