India's coal production has seen a significant downturn, marking the first contraction since the pandemic. According to data from the Commerce Ministry, coal output fell 0.5% in the fiscal year 2025-26 and 4% year-on-year in March 2026. This decline is particularly noteworthy as coal production had not decreased in March since at least 2013. Analysts, including Rajib Maitra from Deloitte South Asia, attribute the downturn to production shortfalls, particularly from major producer Coal India, which accounts for approximately 80% of the country's coal output. Coal India's production fell 1.7% in FY26 and 1.5% in March. The company is currently holding over 100 million tonnes of coal in stock, indicating that some demand may have been satisfied through inventory rather than new production. Additionally, coal prices have sharply declined, influenced by improved supply conditions and a growing share of renewable energy, which has moderated demand growth. Despite these challenges, experts like Amit Bhargava from KPMG maintain that the underlying demand for coal remains strong, cautioning against interpreting the data as a sign of reduced demand. They suggest that the contraction is a result of production issues, inventory dynamics, and pricing pressures rather than a fundamental decline in consumption.