India's Coal Gasification Expansion Targets
The National Coal Gasification Mission has established an ambitious target of achieving 100 Million Tonnes (MT) of coal gasification capacity by 2030. As of the current date, approximately 22.6 Million Tonnes Per Annum (MTPA) of coal gasification capacity is either operational or under implementation across various projects.
Current Project Status
The operational and ongoing projects include Jindal Steel Limited (JSL) with approximately 8 MTPA capacity currently operational, Talcher Fertilisers Limited (TFL) with approximately 2.6 MTPA capacity under implementation, and eight additional projects approved under the ₹8,500 crore Financial Incentive Scheme representing approximately 12 MTPA capacity currently under implementation.
New Financial Incentive Scheme
To accelerate progress toward the national target of gasifying 100 million tonnes of coal, the Government approved a new Scheme for Promotion of Surface Coal/Lignite Gasification Projects on May 13, 2026, with a significantly enhanced financial outlay of ₹37,500 crore. This new scheme is expected to utilize approximately 75 MTPA of coal, representing a substantial contribution toward achieving the overall national target of 100 MT coal/lignite gasification.
Enhanced Incentive Framework
The Government has strengthened the incentive framework under the recently approved scheme to attract greater private and public sector investment. Under the previous scheme approved on January 24, 2024, with a budget of ₹8,500 crores, eligible financial incentives were limited to 15% of the capital expenditure subject to prescribed ceilings. The new ₹37,500 crore scheme provides significantly enhanced financial incentives of up to 20% of the eligible Plant and Machinery cost, subject to prescribed ceilings, for the establishment of coal/lignite gasification projects.
Strategic Objectives
The Government is actively promoting the production of coal-to-chemicals, methanol, and Synthetic Natural Gas through coal gasification by providing comprehensive financial incentives, facilitating coal availability, strengthening regulatory support, simplifying approval processes, and promoting indigenous technologies. This comprehensive approach aims to create an enabling policy framework that will significantly strengthen India's energy security.
This information was formally provided by Union Minister of State for Coal and Mines Shri Satish Chandra Dubey in a written reply presented in the Rajya Sabha on the date of the release.