India's Coal Gasification Push: Government Opens Bidding for 75 Million Tonne Target
NEW DELHI: The central government on Wednesday released a Request for Proposal (RFP) inviting companies to set up coal and lignite gasification projects under a Rs 37,500-crore incentive scheme. This marks a significant step towards achieving the target of gasifying 75 million tonnes of coal and lignite by 2030.
Launched in May, the scheme aims to produce syngas from domestic coal and lignite, reducing India's dependence on imported liquefied natural gas (LNG), urea, ammonia, and methanol. Officials expect to select companies under the scheme within the next four months.
The RFP follows the Union cabinet's approval of the scheme in May and the ministry of coal's issuance of operational guidelines on June 25. To facilitate stakeholder participation and clarify scheme provisions and application processes, the ministry will hold a pre-application conference on July 20.
India currently imports nearly 85% of its crude oil requirement, around 90% of its methanol requirement, and 13-15% of its ammonia requirement. The country's import bill for key substitutable products—including LNG, urea, ammonium nitrate, ammonia, coking coal, methanol, and dimethyl ether (DME)—stood at nearly Rs 2.8 lakh crore in FY25. DME is considered a promising cleaner-burning substitute for LPG, with blends of up to 20% already permitted by the Bureau of Indian Standards for domestic, commercial, and industrial use.
The government expects the scheme to attract investments of Rs 2.5-3 lakh crore across around 25 projects in coal-rich regions, generating employment and promoting self-reliance in the energy and chemicals sectors.
