India’s coal gasification programme has received a major boost, with seven applications submitted in the first round of the Centre’s Rs 37,500 crore Scheme for Promotion of Surface Coal/Lignite Gasification Projects.
The applications have come from leading industrial companies and public sector undertakings, including Adani Enterprises Limited, NTPC Limited, Talcher Fertilisers Limited, Gallantt Ispat Limited and Shyam Sel & Power Limited.
Adani Enterprises has submitted three separate applications, all for urea projects. Talcher Fertilisers has also applied for a urea project, while Gallantt Ispat has proposed a project for Direct Reduced Iron and syngas. NTPC has applied for synthetic natural gas, while Shyam Sel & Power has proposed a syngas project.
The Ministry of Coal described the response as a strong indication of industry confidence in coal gasification and the government’s broader objectives of strengthening energy security, reducing imports and promoting domestic industrial development.
“When we said reports of ‘no takers’ were premature, we were confident that industry would respond and it has, decisively,” a senior Ministry of Coal official said. The official described the seven applications as a “clear vote of confidence” in the scheme and India’s coal gasification mission.
Coal gasification involves converting coal or lignite into syngas, which can subsequently be used to produce higher-value products such as urea, methanol, ammonia, hydrogen and synthetic natural gas.
The scheme was approved by the Union Cabinet in May 2026 with a total financial outlay of Rs 37,500 crore. It aims to promote the conversion of domestic coal and lignite into value-added products and reduce India’s dependence on imports of LNG, urea, ammonia and methanol.
According to the Ministry, these commodities accounted for around Rs 2.77 lakh crore in imports during 2024-25.
The scheme is also aligned with India’s target of achieving 100 million tonnes of coal gasification capacity by 2030. Of this, 75 million tonnes of capacity is envisaged under the new scheme.
The Centre estimates that the initiative could catalyse investments of around Rs 2.5 lakh crore to Rs 3 lakh crore and generate direct and indirect employment opportunities across the value chain.
The latest scheme builds on an earlier Rs 8,500 crore financial incentive scheme approved in January 2024, under which eight gasification projects are currently under implementation.
The applications received in the first round will now undergo detailed evaluation in accordance with the scheme guidelines and the Request for Proposal.
Meanwhile, the Ministry has opened the second round of applications from September 8. Under the RFP, application windows will open at two-month intervals, allowing eligible companies to submit proposals in subsequent rounds.
The Ministry said several prospective applicants are already at advanced stages of project preparation and are expected to participate in the upcoming rounds.
The government aims to use coal gasification to create a stronger domestic ecosystem for value-added coal utilisation while advancing its goals of energy security, import substitution and development of clean coal technologies.
