Ministry of Coal Concludes First Round of ₹37,500 Crore Coal Gasification Scheme
The Ministry of Coal has successfully concluded Round 1 of its Scheme for Promotion of Surface Coal/Lignite Gasification Projects, receiving seven applications from leading public and private sector companies. The scheme, which received an overwhelming response, demonstrates growing industry confidence in coal gasification as a key pillar of India's energy security, import substitution, and industrial development strategy.
The applications received include: NTPC Limited with one project for Synthetic Natural Gas production; Adani Enterprises Limited with three projects for Urea production; Gallantt Ispat Limited with one project for Direct Reduced Iron and Syngas; Shyam Sel & Power Limited with one project for Syngas; and Talcher Fertilisers Limited with one project for Urea production.
Shri Alok Kumar Singh, Advisor (Projects) at the Ministry of Coal, stated that the seven applications represent a clear vote of confidence in the scheme and India's coal gasification mission, decisively countering earlier reports of 'no takers'. The Ministry emphasized that coal and lignite gasification projects are large-scale, capital-intensive investments requiring extensive preparatory work including pre-feasibility studies, technology assessments, environmental considerations, and detailed financial planning.
The scheme was approved by the Union Cabinet chaired by Prime Minister Narendra Modi on May 13, 2026, with a total financial outlay of ₹37,500 crore. Its objectives include promoting conversion of domestic coal and lignite into higher-value products such as syngas, methanol, ammonia, urea, and hydrogen; reducing India's dependence on imports of LNG, urea, ammonia, and methanol which accounted for approximately ₹2.77 lakh crore in imports during FY 2024-25; supporting the national objective of achieving 100 million tonnes of coal gasification capacity by 2030, including developing 75 million tonnes under this scheme; and catalyzing investments estimated at ₹2.5-3 lakh crore while generating substantial direct and indirect employment opportunities.
The scheme builds on the National Coal Gasification Mission and an earlier ₹8,500 crore scheme approved in January 2024, under which eight projects are currently under implementation. Applications received under Round 1 will now undergo detailed evaluation according to scheme guidelines and the Request for Proposal issued on July 7, 2026.
The Ministry has announced the opening of Round 2 from September 8, 2026, with application windows continuing to open at two-month intervals. Several prospective applicants are reportedly at advanced stages of project preparation and are expected to submit proposals in forthcoming rounds. The Ministry remains committed to accelerating coal gasification technology development in India, strengthening energy security and import substitution, and positioning the country as a global leader in clean coal technologies.