India Boosts Coal Gasification under NCGM to Cut Energy & Fertiliser Imports
India is expanding coal gasification under the National Coal Gasification Mission, boosting the budget to Rs 3,525 crore and offering incentives to cut reliance on imported coal, LNG and fertilisers. Leveraging its 5th‑largest coal reserves, the strategy aims to produce syngas for synthetic fuels and fertilizers, align…
India’s energy strategy is increasingly focusing on coal gasification to reduce dependence on imported fuels and fertilisers. The move comes amid a volatile global energy market and the country’s commitment to achieve Net Zero emissions by 2070. Key Developments Budget for the NCGM raised from Rs 300 crore (FY 2025‑26) to Rs 3,525 crore (FY 2026‑27) . Additional Rs 5,925 crore earmarked for coal and lignite exploration (2026‑2031). In January 2024, the centre approved Rs 8,500 crore incentives for coal‑gasification and lignite‑gasification projects. Only one private plant – Jindal Steel, Angul (1.80 MTPA) – is operational; four new projects are being pursued by Coal India Ltd. First pilot of UCG launched at Kasta block, Jharkhand (2024). Important Facts India holds 378 billion tonnes of estimated coal reserves (5th globally), with 199 billion tonnes proven. Coal currently supplies 55 % of commercial energy and >70 % of power generation; projected to fall to 27 % by 2047 . Annual coal imports stand at 243 million tonnes , >80 % from Indonesia, Australia and South Africa. Indian coal ash content is high (30‑45 %) versus the global average (10‑20 %), raising gasification costs. About 40 % of reserves lie deeper than 300 m, making conventional mining expensive. Syngas composition: CO, CO₂, H₂, CH₄ – feedstock for SNG , methanol, dimethyl ether, ammonia and urea. UPSC Relevance The topic intersects multiple GS papers: GS3 (Energy & Resources) for understanding coal‑based energy transition; GS3 (Industrial Policy) for domestic fertiliser production; and GS4 (Ethics & Governance) for balancing economic growth with environmental commitments such as Net Zero . Comparing India’s nascent gasification sector with China’s mature ecosystem offers insight into technology transfer and strategic autonomy. Way Forward Adopt proven overseas gasification technologies while tailoring them to high‑ash Indian coal. Scale up CCUS integration to make coal‑derived syngas compatible with climate goals. Incentivise private sector participation through fiscal grants and risk‑sharing mechanisms. Prioritise development of reserves in Odisha, Jharkhand and Chhattisgarh to reduce logistical bottlenecks. Strengthen R&D on ash‑reduction and low‑temperature gasification to cut costs.
Quick Reference
Key Insight
Coal gasification push aims to cut energy and fertiliser imports, bolstering self‑reliance
Key Facts
- NCGM budget increased to Rs 3,525 crore for FY 2026‑27 (up from Rs 300 crore in FY 2025‑26).
- An additional Rs 5,925 crore allocated for coal and lignite exploration for 2026‑2031.
- Centre approved Rs 8,500 crore incentives in Jan 2024 for coal‑ and lignite‑gasification projects.
- India holds 378 billion tonnes of coal reserves (199 billion tonnes proven), 5th globally.
- Coal contributes 55% of commercial energy and >70% of power generation, projected to fall to 27% by 2047.
- Only one private gasification plant (Jindal Steel, Angul – 1.80 MTPA) is operational; four new projects by Coal India Ltd are in pipeline.
- First underground coal gasification (UCG) pilot launched at Kasta block, Jharkhand in 2024.
Background
Coal gasification under the National Coal Gasification Mission (NCGM) is being promoted to reduce India's reliance on imported fuels and fertilisers, aligning with the country's energy security and Net‑Zero commitments. The strategy leverages abundant domestic coal reserves while addressing high ash content and deep‑seated deposits through technologies like UCG and CCUS.
UPSC Syllabus
- GS1 — Distribution of Key Natural Resources
- GS3 — Infrastructure - Energy, Ports, Roads, Airports, Railways
- Prelims_GS — National Current Affairs
- Essay — Environment and Sustainability
- Prelims_GS — Social and Economic Geography of India
- GS2 — Effect of policies of developed and developing countries on India
- GS2 — Government policies and interventions for development
- Essay — Economy, Development and Inequality
- GS1 — Poverty and Developmental Issues
- GS3 — Farm subsidies, MSP, PDS, food security and technology missions
Mains Angle
GS3 (Energy & Resources) – Discuss how scaling coal‑gasification can balance energy security, industrial self‑reliance and climate goals; likely question: "Evaluate the role of coal gasification in India's pursuit of energy security and Net‑Zero by 2070."