India Approves ₹37,500 Crore Coal Gasification Scheme
In response to rising energy security concerns caused by West Asia conflicts, the Union Cabinet chaired by Prime Minister Narendra Modi has approved a ₹37,500 crore coal gasification scheme.
The decision aims to strengthen India’s energy security and reduce dependency on energy imports.
Impact of Global Energy Crisis
The West Asia crisis has led to a sharp rise in global oil and gas prices, affecting sectors such as aviation and manufacturing.
India currently imports:
- Over 50% of LNG requirements
- Around 20% of urea
- Nearly 100% of ammonia
- 80–90% of methanol
In FY 2024–25, India spent approximately ₹2.77 lakh crore on importing these products.
Coal Gasification Push
Although coal gasification has been discussed for over 25 years in India, it has not achieved major success so far.
The government now considers coal gasification a strategic necessity.
National Target and Scheme Details
Under the approved scheme, the government aims to gasify around 7.5 crore tonnes of coal or lignite. This is a major step toward the national target of 10 crore tonnes of coal gasification by 2030.
Financial incentives under the scheme include:
- Up to 20% of plant and machinery cost as financial support
- Incentives linked to project milestones in four equal installments
- Total incentive ranging from ₹5,000 crore to ₹12,000 crore