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Coal Gasification Target: 100 MT by 2030, New ₹37,500 Cr Scheme

UPSC / SSC current affairs note · IR

EnergyIRScience and TechnologyGovernment Policies and Interventions

Why in news

The government has approved a new ₹37,500 crore scheme to promote surface coal/lignite gasification projects, aiming to achieve the national target of 100 million tonnes (MT) coal gasification by 2030. This was informed by the Minister of State for Coal and Mines in a Rajya Sabha reply on July 20, 2026.

Background

The National Coal Gasification Mission was launched to promote coal gasification in India. An earlier scheme of ₹8,500 crore was approved on January 24, 2024, providing financial incentives at 15% of capex. The new scheme enhances the incentive to 20% of eligible plant and machinery cost.

Key facts

in5points

  1. National Coal Gasification Mission targets 100 MT coal gasification capacity by 2030.

  2. Current capacity operational/under construction is ~22.6 million tonnes per annum (MTPA).

  3. Jindal Steel Limited (JSL) has ~8 MTPA operational capacity.

  4. Talcher Fertilizers Limited (TFL) has ~2.6 MTPA under implementation.

  5. 8 projects under the ₹8,500 crore scheme are approved, adding ~12 MTPA.

  6. New scheme (May 13, 2026) has an outlay of ₹37,500 crore for surface coal/lignite gasification.

  7. New scheme provides financial incentive up to 20% of eligible plant and machinery cost.

  8. Expected to utilize ~75 MTPA of coal, bridging the gap to the 100 MT target.

  9. Government promotes coal-to-chemicals, methanol, and synthetic natural gas via gasification.

  10. Support includes easier coal availability, regulatory support, and indigenous technology promotion.

Prelims pointers

  • National Coal Gasification Mission
  • Target: 100 MT coal gasification by 2030
  • ₹8,500 crore scheme (Jan 24, 2024): 15% capex incentive
  • ₹37,500 crore scheme (May 13, 2026): 20% incentive on plant & machinery
  • Jindal Steel Limited (JSL) – 8 MTPA operational
  • Talcher Fertilizers Limited (TFL) – 2.6 MTPA
  • Coal-to-chemicals, methanol, synthetic natural gas
  • Ministry of Coal
  • Rajya Sabha reply by Minister of State for Coal and Mines

Mains angles

  • Discuss the significance of coal gasification for India's energy security and its role in reducing import dependence.
  • Critically examine the government's financial incentive schemes for coal gasification and their potential to achieve the 100 MT target.
  • Analyze the environmental implications of coal gasification compared to direct coal combustion.