India approves 3.9 bln USD scheme to turn coal into gas amid supply concerns

In response to an escalating energy crisis and growing supply concerns driven by ongoing Middle East conflicts, the Indian government has approved a 3.92-billion-USD financial scheme to boost domestic coal gasification projects. Federal Information Minister Ashwini Vaishnaw announced the cabinet decision, noting that the initiative aims to accelerate India’s coal and lignite gasification program to hit a national target of gasifying 100 million tonnes of coal by 2030.

The massive financial push leverages India’s extensive domestic resources, which include approximately 401 billion tonnes of coal and 47 billion tonnes of lignite reserves. Coal currently accounts for over 55 percent of India’s total energy mix. Through the gasification process, these raw resources will be converted into synthesis gas (syngas), a versatile cleaner-burning alternative that can be utilized to generate electricity and manufacture essential chemicals, fertilisers, and other downstream products.

To incentivize rapid development and attract investment, the Indian government will provide direct financial assistance covering roughly 20 percent of the cost of plant and machinery for approved projects. The scheme is positioned as a critical step toward reducing India’s dependence on volatile energy imports and reinforcing its domestic energy security grid.