Cost and Benefits of Adani’s Carmichael Coal Project in Australia

Synopsis – Adani is making one of the world’s largest new coal investments in the Carmichael coal mine project in Queensland. This article analyzes the Costs and Benefits of the Project.


New investment in coal will be a major factor if India is not able to meet its commitment against Climate Change.

Recently the Adani’s $16.5 billion dollar investment in the Carmichael coal mine project in Queensland has sparked debate. Being a primary buyer of this project, India would also face its environmental consequences.

Proposed benefits of Adani’s Carmichael coal project-
  • Economic benefits – It would be the largest coal mine in Australia and one of the largest in the world. It will produce 60 million tonnes of coal per year at full capacity. The mine is expected to produce 2.3 billion tonnes over the next 60 years.
  • It will create employment opportunities and generate revenue for Australia’s economy.
  • Australian government’s subsidies- Despite the G20 commitment to phase out inefficient fossil fuel subsidies, the Queensland and Australian governments have proposed various forms of assistance to the Carmichael coal project.


  • Firstly, fnancial viability- With coal prices falling, the mine may not be able to produce enough income to cover its costs.
    • A number of major international banks ruled out financing the Carmichael Mine and Rail Project. It is due to its poor return on investment and environmental risks.
  • Secondly, environmental and climate impacts – The project is likely to emit 4.7 billion tonnes of greenhouse gas emissions. This is more than 0.5% of the remaining global carbon budget for limiting warming to 2 degrees C.
    • Climate change is already affecting Australia. The frequency and intensity of droughts and extreme weather events such as heat-waves, storms and flooding, and bushfires are increasing.
  • Thirdly, health Impact- Coal mining causes fine particle pollution, which contributes to heart diseases, lung diseases, and lung cancer.
    • In Australia, health damage due to CO2 emission alone costs $2.6 billion annually.
    • In India, coal is responsible for 100000 premature deaths each year.
Way forward-

Approval to Adani to mine and export coal to India can hamper India’s carbon-neutrality .

Therefore, to avoid dangerous climate change and increased risks to human health, it is required to keep the global temperature rise within 2°C. This means Australian and Indian coal reserves need to stay under the ground.

Source- The Hindu

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