The government announced its support for coal gasification projects, recognizing their significant potential to transform coal into a variety of valuable products.
Coal gasification, a thermo-chemical process, converts coal into synthesis gas or 'syngas', which primarily consists of carbon monoxide and hydrogen.
This technology offers a promising solution to reduce India's heavy reliance on imports, especially in the oil, gas, fertilizer, and petrochemical sectors.
Currently, India imports approximately 83 percent of its oil, over 90 percent of its methanol, and about 13-15 percent of its ammonia.
By promoting coal gasification, the government aims to achieve partial import substitution for oil and gas, while also making cleaner use of the country’s abundant coal reserves. In a statement, the coal ministry emphasized that these projects could help conserve foreign exchange and bolster domestic industries.
To incentivize coal gasification, the government is offering a 50 percent rebate in revenue share for commercial auction policies targeting gasification coal. Additionally, a new sub-sector for syngas production has been established, and long-term coal allotments are being provided to gasification plants.
The Coal Gasification Mission, launched in 2020, aims to gasify 100 million tonnes of coal by 2030.
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