The Ministry of Coal has announced significant progress and new initiatives under India's National Coal Gasification Mission, which targets achieving 100 Million Tonnes (MT) of coal gasification capacity by 2030. As of July 2026, approximately 22.6 Million Tonnes Per Annum (MTPA) of capacity is operational or under implementation, including Jindal Steel Limited's (JSL) 8 MTPA operational capacity and Talcher Fertilisers Limited's (TFL) 2.6 MTPA project under implementation. Additionally, eight projects approved under the ₹8,500 crore Financial Incentive Scheme announced on January 24, 2024, contribute ~12 MTPA currently under implementation.
On May 13, 2026, the Government approved a new Scheme for Promotion of Surface Coal/Lignite Gasification Projects with a financial outlay of ₹37,500 crore. This scheme is expected to utilize approximately 75 MTPA of coal and substantially contribute toward the 100 MT target. Among the eight projects under the earlier ₹8,500 crore scheme, JSL's project has achieved financial closure and is under construction, while five projects have completed ground breaking and are obtaining clearances.
The government provides comprehensive support through financial incentives, coal linkage, and policy measures. Financial support includes 15% of capex under the ₹8,500 crore scheme and up to 20% of eligible Plant and Machinery cost under the ₹37,500 crore scheme. Coal linkage auction availability has been facilitated through a new "production of Syngas" sub-sector at power sector floor prices, with linkage tenure extended to 30 years. Policy support includes 50% rebate in revenue share for gasification coal, framework guidelines for underground coal gasification (UCG), exemption for UCG pilot projects, reduced UCG floor price from 4% to 2%, and waiver of upfront payment with 50% rebate on Performance Bank Guarantee.
During India's BRICS Chairmanship, the Ministry organized a Side Event on Clean Coal Technologies on June 24, 2026, focusing on coal gasification knowledge exchange among BRICS nations. Coal gasification enables cleaner utilization of domestic coal for synthetic natural gas, chemicals, fertilizers, hydrogen, and downstream products, reducing import dependence. The initiatives are expected to strengthen energy security, promote import substitution, encourage value-added production, attract investments, generate employment, and improve resource utilization. Upon commissioning of projects under both schemes and TFL, import substitution from coal/lignite gasification is projected to reach approximately ₹1.5 lakh crore annually.