India’s ambitious coal gasification drive has received a major industry boost, with seven applications submitted in the first round of the Centre’s Rs 37,500 crore scheme, including bids from major corporate houses and public sector undertakings.

 

NTPC, Adani Enterprises, Talcher Fertilisers, Gallantt Ispat and Shyam Sel & Power Limited are among the applicants, in what the Ministry of Coal described as a strong vote of confidence in the government’s coal gasification mission.

 

The first round of the Scheme for Promotion of Surface Coal/Lignite Gasification Projects closed with seven applications, decisively countering earlier reports that the scheme was struggling to attract investors.

 

“When we said reports of ‘no takers’ were premature, we were confident that industry would respond and it has, decisively. Seven applications in the very first round, including from some of India’s largest industrial houses and public sector undertakings, are a clear vote of confidence in the scheme and in India’s coal gasification mission. The market has spoken, and it has spoken loudly.”- said Alok Kumar Singh, Advisor (Projects), Ministry of Coal.

 

The response is significant given the scale and complexity of the projects. Coal and lignite gasification requires substantial upfront work, including pre-feasibility studies, technology selection, environmental assessments and detailed financial planning.

 

The applications were submitted after the Ministry issued its Request for Proposal on 7 July 2026. The government expects the projects to help build a stronger domestic coal gasification ecosystem, complementing eight projects already under implementation under an earlier Rs 8,500 crore financial incentive scheme.

 

Approved by the Union Cabinet on 13 May 2026, the new scheme is designed to accelerate the conversion of domestic coal and lignite into higher-value products such as syngas, methanol, ammonia, urea and hydrogen.

 

The government sees gasification as a strategic tool to reduce India’s dependence on imports of LNG, urea, ammonia and methanol. These commodities together accounted for around Rs 2.77 lakh crore in imports during FY 2024-25.

 

The scheme also supports India’s target of creating 100 million tonnes of coal gasification capacity by 2030, including 75 million tonnes under the new programme.

 

The Centre estimates that the initiative could catalyse investments of Rs 2.5 lakh crore to Rs 3 lakh crore and generate significant direct and indirect employment across the value chain.

 

The momentum is now set to continue. The Ministry of Coal has opened the second round of applications from 8 September 2026.

 

Under the RFP, fresh application windows will open at two-month intervals, giving eligible companies regular opportunities to enter the programme.

 

Several prospective applicants are already at advanced stages of project preparation and are expected to submit proposals in the coming rounds, suggesting that the seven applications received in Round 1 could be only the beginning of a much larger investment pipeline.

 

The scheme builds on the National Coal Gasification Mission and the Rs 8,500 crore programme approved in January 2024, under which eight projects are currently being implemented.

 

With major industrial groups and public sector players now entering the fray, the government is positioning coal gasification as a critical component of its broader push for energy security, import substitution and domestic industrial growth.