India Builds 139 First Mile Connectivity Projects to Modernise Coal Transport

India is expanding its coal logistics infrastructure through 139 First Mile Connectivity projects with a combined handling capacity of 1,319 million tonnes per annum, as the government works to create a faster, cleaner and more efficient system for moving coal from mines to consumers.

The Ministry of Coal said 72 of these projects, representing a cumulative capacity of nearly 589 million tonnes per annum, have already been commissioned. The remaining 67 projects are currently at different stages of planning, tendering and implementation and are expected to be completed progressively by the financial year 2029–30.

The programme forms part of the Coal Logistics Plan and Policy, 2030, which seeks to strengthen rail-based evacuation, introduce mechanised coal handling and expand multimodal transportation across the country.

The information was provided by Union Minister of State for Coal and Mines Satish Chandra Dubey in a written reply in the Rajya Sabha on July 20, 2026.

Expanding Railway Capacity for Coal Evacuation

Rail infrastructure remains central to the government’s coal logistics strategy. Of the eight major railway projects identified for coal evacuation, five have already been commissioned. The remaining three are scheduled for completion by the financial year 2027–28.

The Ministry of Coal has also identified 33 critical railway projects that are being taken up by the Ministry of Railways to meet future coal transportation requirements.

These projects are expected to improve connectivity between mining regions, power plants, industrial consumers, ports and major railway corridors. Additional rail capacity will also help reduce congestion on routes that currently carry high volumes of coal and other freight.

The government aims to increase the share of coal transported by rail to 75 per cent by the financial year 2029–30. Greater use of railways is expected to reduce logistics costs, improve transportation reliability and ease pressure on highways used for coal movement.

Mechanised Handling and Conveyor Transport

First Mile Connectivity projects are designed to replace conventional truck-based movement between mine pitheads and railway sidings with mechanised systems such as conveyor belts, silos and rapid loading facilities.

Coal extracted from mines can be transported directly through closed conveyor systems to loading points, where it is transferred into railway wagons using automated infrastructure.

The system reduces manual handling, improves loading accuracy and shortens the time required to prepare and dispatch railway rakes. Mechanised loading also improves wagon utilisation and limits losses caused by repeated handling and transportation.

The use of enclosed conveyors and silos can reduce dust generation, road congestion and environmental pressure around mining areas. It also supports more consistent coal quality by limiting exposure to contamination and weather during transit.

Bottlenecks in Coal Transportation

The Ministry has identified several challenges that continue to affect coal movement from mines to end users.

Rail capacity remains inadequate on some high-density corridors, leading to congestion and delays. Railway projects can also face extended timelines because of land acquisition, project sanctioning, forest clearances, environmental approvals and construction-related issues.

Operational constraints involving the availability, placement and turnaround of railway rakes can affect coal dispatch from mining regions. Delays in rake supply may create stock accumulation at mines and disrupt timely delivery to power plants and industrial consumers.

Road-based coal transportation creates additional challenges, including traffic congestion, higher costs and environmental concerns associated with emissions and dust.

The development of alternative modes such as coastal shipping, inland waterways and Rail-Sea-Rail transportation also requires suitable terminals, handling facilities and reliable last-mile connectivity.

The Ministry of Coal regularly reviews priority railway and First Mile Connectivity projects with the Ministry of Railways, coal companies, State Governments and other agencies to resolve implementation issues.

Integrated Coal Logistics Plan

The Ministry of Coal has launched an Integrated Coal Logistics Plan in collaboration with the ministries responsible for railways, power, roads, transport and ports.

The plan seeks to establish a technology-enabled, resilient and cost-effective logistics network capable of supporting India’s rising domestic coal production.

It focuses on improving coordination between mines, railways, ports, power plants and industrial consumers while promoting the use of multiple transportation modes.

The strategy includes the development of the 33 critical railway projects, expansion of mechanised coal handling infrastructure and wider use of coastal shipping and inland waterways.

By combining rail, sea and road networks more efficiently, the government aims to reduce the total cost of coal delivered to consumers and improve the reliability of fuel supplies.

Promotion of Rail-Sea-Rail Transport

Coal India Limited is encouraging the use of the Rail-Sea-Rail route, under which coal is transported by rail from mines to ports, moved by coastal shipping and then carried by rail or road to the final destination.

To make this mode more attractive, the performance incentive applicable to coal supplied beyond the Annual Contracted Quantity has been reduced from 40 per cent to 20 per cent for eligible Rail-Sea-Rail movement.

The measure is intended to lower transportation costs for consumers and reduce pressure on heavily used railway corridors.

Coastal shipping can be particularly useful for supplying power plants and industries located near India’s eastern and western coasts. Inland waterways may also offer an economical option where navigable routes and terminal infrastructure are available.

Improving Coal Supply Reliability

The expansion of railway connectivity and mechanised handling systems has increased coal evacuation capacity and improved loading efficiency across mining regions.

Rapid loading systems have reduced the time required to load railway rakes, enabling wagons to return more quickly for subsequent trips. Faster turnaround can increase the effective capacity of the railway network without relying entirely on the addition of new rakes.

Improved coordination between the Ministry of Coal, Ministry of Railways, coal producers and the power sector has also supported sustained dispatches and timely delivery of coal to thermal power plants and other consumers.

The continuing development of railways, First Mile Connectivity systems and multimodal transportation infrastructure is expected to reduce dependence on road transport, lower logistics expenditure and support the projected expansion of domestic coal production up to the financial year 2029–30.

The programme represents a broader shift towards integrated and mechanised coal logistics, linking mine production more closely with railway capacity, port infrastructure and the requirements of power and industrial consumers.

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Source: PIB

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