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Coal Ministry Pre-Application Meet for Rs 37,500 Cr Surface Coal/Lignite Gasification Scheme

UPSC / SSC current affairs note · Economy

EconomyEnergyIRGovernment Policies

Why in news

The Coal Ministry held a pre-application conference for the Rs 37,500 crore Surface Coal and Lignite Gasification Scheme, drawing significant industry participation. This scheme aims to promote clean and efficient use of domestic coal, reduce import dependence, and boost investment and employment.

Background

The Union Cabinet approved the scheme on May 13, 2026. It is designed to accelerate development of surface coal and lignite gasification projects for producing high-value products like synthetic natural gas, ammonia, methanol, DRI, synthetic fuels, and chemicals.

Key facts

in5points

  1. Scheme outlay: Rs 37,500 crore approved by Union Cabinet on May 13, 2026.

  2. Pre-application conference held on July 20, 2026, chaired by Coal Ministry Additional Secretary Sanoj Kumar Jha.

  3. Participants included PSUs, private companies, technology providers, and potential applicants.

  4. Scheme targets production of synthetic natural gas, ammonia, methanol, direct reduced iron (DRI), synthetic fuels, and chemicals.

  5. Expected to catalyze investment of Rs 2.5-3 lakh crore.

  6. Aims to promote use of about 7.5 crore tonnes of coal annually.

  7. Expected to generate approximately 50,000 jobs.

  8. Aims to significantly reduce India's import dependence on energy and chemical products.

  9. Last date for submission of applications: September 7, 2026.

  10. Detailed guidelines and RFP provisions were explained during the conference.

Prelims pointers

  • Scheme: Surface Coal and Lignite Gasification Scheme (Rs 37,500 crore)
  • Approved by: Union Cabinet on May 13, 2026
  • Ministry: Ministry of Coal
  • Key products: Synthetic natural gas, ammonia, methanol, DRI, synthetic fuels, chemicals
  • Expected investment: Rs 2.5-3 lakh crore
  • Expected coal use: ~7.5 crore tonnes/year
  • Expected employment: ~50,000 jobs
  • Application deadline: September 7, 2026

Mains angles

  • GS3: Energy – Discuss the significance of coal gasification in India's energy security and import substitution.
  • GS3: Environment – Evaluate the environmental implications of coal gasification versus traditional coal use.
  • GS3: Economy – Analyze the potential of the scheme to attract investment and create employment in the coal sector.
  • GS2: Government Policies – Critically examine the effectiveness of government incentives in promoting clean coal technologies.