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Today on the show, we focus on the coal gasification scheme recently approved by the Union Cabinet – a major push aimed at strengthening India’s energy security and reducing dependence on imports. With a financial outlay of Rs 37,500 crore, the Scheme for Promotion of Surface Coal and Lignite Gasification Projects is a significant step towards India’s target of gasifying 100 million tonnes of coal by 2030. The larger objective is to reduce import dependence on key energy and industrial inputs such as LNG, urea, ammonia and methanol. India currently imports more than 50% of its LNG requirements, around 20% of urea, nearly 100% of ammonia, and 80–90% of methanol. In another accompanying major reform, the government has extended coal linkage tenure up to 30 years under the “Production of Syngas leading to Coal Gasification” category in the Non-Regulated Sector linkage auction framework – providing long-term policy certainty for investors. India has one of the world’s largest coal reserves — around 401 billion tonnes — along with nearly 47 billion tonnes of lignite reserves. Coal continues to account for over 55% of India’s energy mix. Coal gasification converts coal or lignite into synthesis gas, or syngas, through a chemical process carried out above ground. Instead of directly burning coal, the process uses high temperature, pressure, steam and oxygen to break down the coal’s molecular structure and produce a versatile synthetic gas. India’s coal gasification journey gathered momentum in 2018 with the announcement of the coal gasification-based fertiliser plant at Talcher – an early move toward cleaner coal technologies. In 2020, India announced its national target of gasifying 100 million tonnes of coal by 2030, with projected investments of over ₹4 lakh crore. And now, in May 2026, the government has scaled up its efforts further, with the Union Cabinet approving a ₹37,500 crore incentive scheme for surface coal and lignite gasification projects. So, how can coal gasification help reduce India’s import dependence? What role can it play in the country’s energy transition and long-term energy security goals? And can cleaner coal technologies coexist with India’s green energy ambitions?
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