Six years on, India's coal gasification yet to take off in missed opportunity amid West Asia crisis

Six years after launching its coal gasification mission, and four years shy of the 2030 target of gasifying 100 million tonnes of coal, India has little to show for it –– a gap that looks particularly stark at a time when the war in West Asia has affected energy supplies to India.To be sure, the government raised the budget for the coal gasification mission by over 1,075% to ₹3,525 crore in 2026-27 from ₹300 crore in 2025-26, but almost the entire 2025-26 allocation remained unspent until January 2026, according to official records.Also read: Delhi PWD shifts to more ‘durable’ precast drain boxes for stormwater systemAmid current global energy crisis , the mission is again in focus as one of the measures to reduce India’s energy import dependence, people aware of the development said, requesting anonymity. India is the world’s third-biggest importer of crude oil after the US and China, importing over 88% of the crude it processes.Although the government launched its coal gasification mission in 2020, aiming to gasify 100 million tonnes of coal by 2030, commercial output remains elusive, the people added. Coal gasification is a thermo-chemical process that converts coal into synthesis gas or “syngas” (SNG), primarily consisting of carbon monoxide and hydrogen, a coal ministry statement issued on July 24, 2024, said.Also read: Push to roll out women’s quota in line with Opposition demands: PM ModiStill, while China has grown its own coal gasification programme –– it processes hundreds of millions of tonnes of coal into gas every year –– reducing its dependence on imports of Liquified Natural Gas (LNG), India’s progress has been slow.Two years and a bit after launching the coal gasification mission, Coal India Ltd (CIL), a state-owned company signed memoranda of understanding (MoUs) in October 2022 with GAIL, for a coal-to-SNG project in Burdwan district of West Bengal envisaged a project cost of ₹13,052.81 crore, and BHEL for the coal-to-ammonium nitrate project in Odisha proposed an investment of ₹11,782.05 crore.But, it took till January 2024 for the Union Cabinet to approve the equity investments by CIL in these joint ventures with two state-owned entities.“Coal India Limited (CIL) will set up following two coal gasification plants with a view to achieve the target of 100 MT coal gasification by the year 2030 and to fulfil India’s dual objectives of self-reliance and energy independence,” the Cabinet Committee on Economic Affairs (CCEA) said in a statement at the time.Also read: Arson, stone-pelting in Noida as wage hike protest turns violentThe coal ministry, CIL, GAIL India and BHEL did not respond to email queries on the mission’s progress.“It seems that almost the entire ₹300 crore estimated in the 2025-26 budget estimates (BE) remained unspent because of no progress made on coal gasification projects in the previous fiscal. However, this financial year the BE is an ambitious ₹3,525 crore,” one of the people cited above said. . According to government records, the BE allocation for 2025-26 was reduced to ₹285 crore at the RE (revised estimate) stage and “no expenditure” was made till the end of January .Replying to a question on coal gasification at the inter-ministerial briefing related to energy supply situation amid ongoing war in West Asia on April 8, Sanjeev Kumar Kassi, joint secretary in the coal ministry, said coal gasification is the next step to maximise use of an abundantly available energy source. India has the fourth largest coal reserves in the world, estimated at 401 billion tonnes.Also read: Uttam Nagar Holi murder: MCD razes suspect’s under-construction house in Delhi in ‘routine drive’“The next avenue available to us is coal gasification where we produce gas to convert those gases to chemicals. In this case, we would be attempting first the fertiliser plant… Talcher Fertiliser Plant is there already there, and I believe by FY27 December that plant would be ready.”The plant is expected to use gas from coal as both fuel and feedstock for producing fertiliser.Prime Minister Narendra Modi, on September 22, 2018, unveiled a plaque to mark the commencement of work for the revival of the Talcher Fertiliser Plant. The project was expected to be ready by September 2024, but it missed the target due to various reasons, including the Covid-19 pandemic.Besides the fertiliser project, the government in 2024 approved seven major projects related to coal gasification, according to Kassi. “Ground breaking has been done for four projects. So, we are, in fact, much close to the gasification process. These are all surface gasification,” he said.In a social media post on X, Union coal minister G Kishan Reddy on March 13 said the coal gasification initiative will lead to diversified use of coal, import substitution for oil and gas and cleaner utilisation of India’s abundant coal reserves that are currently estimated at 401 billion tonnes with about 220 billion tonnes classified as “proven”.“In 2020, the Coal Gasification Mission was launched, with the aim of gasifying 100 million tonnes of coal by 2030, thereby maximizing the value and utility of this vital resource and also embracing cleaner energy solutions and ensuring the sustainable use of coal. Aligning with the vision of the Hon’ble Prime Minister Shri @narendramodi, the Coal gasification initiative has been allocated a Financial Outlay of ₹8,500 crore through a transparent process for both the private sector and PSUs,” he added.The vision laid out for coal gasification is coming to fruition, the minister said as he, along with chief minister of Maharashtra participated in the ground breaking ceremony in Bhadrawati Industrial Area, Chandrapur, Maharashtra, for the first projects under the scheme he detailed in the post. One of the projects is by Greta Energy and Metal Pvt Ltd and another by New Era Cleantech Solution Pvt Ltd.

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Six years on, India's coal gasification yet to take off in missed opportunity amid West Asia crisis

Amid current global energy crisis , the mission is again in focus as one of the measures to reduce India’s energy import dependence, sources told HT.

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More from HT

Six years on, India's coal gasification yet to take off in missed opportunity amid West Asia crisis

Amid current global energy crisis , the mission is again in focus as one of the measures to reduce India’s energy import dependence, sources told HT.