Coal production had to be curtailed in the month of April on the back of low offtake of the fossil fuel, a top official on Monday said.
The government has set a target of 1.5 billion tonnes coal output by 2020.
"I think the offtake was not as anticipated so we did have to cut down our production in April this year but I think it will pick up. We all are very very hopeful that Ujwal DISCOM Assurance Yojana (UDAY) will kick in," Coal Secretary Anil Swarup said in an interview to CNBC-TV18.
Stating that coal inventories to the tune of about 50 million tonnes (MT) were lying at the pitheads and about 30 odd MT were at power plants, the secretary said "but we have worked out the strategy to liquidate that (coal inventories)."
"Apart from power plants, there is a lot of demand (of coal) in the steel and aluminium sector. So we are going ahead with coal linkage auctions," he said.
The auction would start by the month end and continue over the next few months till the coal stocks are liquidated.
The coal secretary was hopeful of greater demand for coal going forward as various sectors like steel, aluminium and cement pick up.
"We believe that these sectors will also pick up and as the economy picks up there will be greater demand for coal in sectors other than power," he said.
Replying to a question, he said the coal ministry has had informal talks with Finance Ministry on the proposed Coal India divestment and buyback.
Coal India, which accounts for over 80 per cent of the domestic coal production, is eyeing an output of 598 MT in the ongoing fiscal. It is also targeting an output of one billion tonne by 2020.(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)