Coal India to terminate FSAs with customers who renege on contracts

The monopoly miner said it is considering to stop any further FSAs with those customers, "who renege on committed agreements and decide to terminate their contracts abruptly"

The country’s national miner Coal India (CIL) is planning to terminate fuel supply agreements (FSAs) with its customers reneging on contracts, citing reasons of ‘low quality’ and ‘transportation cost’. 

The company said such customers had paid a premium for securing coal through auctions in the past without complaints. But “now, with Covid-19-induced slowdown, when the demand for coal is low and the floor prices for coal relatively lower, some customers are moving away, citing reasons that are not reasonable,” it said. 

Recently, there were reports that Vedanta, Jindal Steel & Power, and Hindalco Industries have terminated their supply contracts with CIL, citing