This is the real practice behind the story's turning point. Here is what to find out and understand.
Why a canary and not a dog or a lamp? A bird's lungs are far more efficient than a mammal's. Air flows through them in one direction, through air sacs, so a bird takes in oxygen on the in-breath and the out-breath both. Its small body also has a very high metabolic rate. The result: a canary absorbs carbon monoxide several times faster than a man of the same weight, and it shows distress — swaying, then falling off the perch — long before a miner feels anything worse than a headache. That warning time is what saved lives.
Why carbon monoxide is so dangerous. It is colourless, odourless and slightly lighter than air, so no sense of ours detects it. It binds to haemoglobin roughly 200 times more readily than oxygen does, so the blood fills with a gas it cannot use. The victim grows slow, drowsy and confused — and confusion is the worst symptom of all, because it removes the ability to notice that anything is wrong. That is exactly the state Clarke's narrator is in: “My mind seemed to be very sluggish that morning.”
The Indian link. Coal in Arunachal Pradesh, and in the older fields of Jharkhand, West Bengal and Meghalaya, was mined in shafts where 'afterdamp' (mainly carbon monoxide and nitrogen) collected after a fire or blast. Caged canaries were carried down as living detectors. The practice was retired in favour of electronic gas detectors — in Britain formally in 1986 — and India's mines today use portable multi-gas monitors and continuous methane detectors under the Directorate General of Mines Safety.