“We forecast improving Indian growth fundamentals to continue driving seaborne coking coal demand,” the bank said.

Annualising year-to-date coking coal export data, it said India’s share was 23%, with Japan on 22% and China, 21%.

Morgan Stanley said Australian product was about 85% of all Indian coking coal imports in 2014, making the country the largest supplier by a significant margin.

“In our opinion, this large market share points to an extensive marketing network that is likely already in place, allowing Australian suppliers to continue having a significant share in a growing market.”

The bank said it expected Indian imports of coking coal to grow by about 44% by 2020. It added India’s coal reserves were largely thermal, leaving the country short of coking coal.

“Our commodities team forecasts India’s coking coal imports to rise from 45 million tonnes in 2014 to 65 million tonnes by 2020, up 44%, or the equivalent of compound annual growth of 6.5%.”

India’s steel production could grow by nearly 60% by 2020: “Although we expect India’s growth to be capitalistic in nature and, hence, much more measured when compared to China’s, the need for increased housing is likely to be a key driver for steel demand in India, spurred by the government’s initiative of ‘housing for all’ by 2022.”

A traditionally under-invested infrastructure base would also drive growth.

“We expect Indian steel production to grow from 82Mt in 2014 to 131Mt by 2020, 59% growth, or 8% compound annual growth.”

This looked plausible “when we look at current steel intensity differentials between China ( about 600kg/capita) and India ( around 70kg/capita)”