New Delhi, 13 May (H.S.):

The Union Cabinet, chaired by Prime Minister Narendra Modi, on Wednesday approved a scheme worth Rs 37,500 crore to promote surface coal (lignite) gasification projects. The scheme aims to accelerate the conversion of surface coal (lignite) into gas across the country, with a target to gasify 100 million tonnes of surface coal by 2030 to generate energy.

Union Minister Ashwini Vaishnaw described the decision at a press briefing at the National Media Centre as a landmark move, noting that India possesses reserves sufficient for roughly 200 years and that these reserves will now be tapped for gas production. The scheme is expected to attract investments of about Rs 3 lakh crore. Gasification will reduce the country’s energy dependence and lower reliance on imports of products such as liquefied natural gas (LNG), urea, ammonia and methanol.

Notably, India holds one of the world’s largest coal endowments — about 40.1 billion tonnes of coal and 4.7 billion tonnes of lignite. Coal accounts for more than 55 per cent of the nation’s energy consumption. Through gasification, coal and lignite are converted into synthesis gas (syngas), which can be used to produce fuels and chemicals. This will help reduce India’s import dependence for items such as LNG, urea, ammonium nitrate, ammonia, coking coal and methanol.

The Ministry of Coal said the scheme will incentivise new surface coal (lignite) gasification plants. Financial incentives of up to 20 per cent of plant and machinery costs will be available. Project selection will follow a transparent, competitive bidding process. A single project may receive up to Rs 5,000 crore in incentives; a cap of Rs 9,000 crore has been set for any single product, and a group‑wise ceiling of Rs 12,000 crore will apply to any single corporate group.

The ministry added that the government has extended coal‑linking periods to 30 years to provide investors with long‑term policy assurance. The scheme is expected to support around 25 projects nationwide, creating more than 50,000 direct and indirect jobs and generating approximately Rs 6,300 crore in annual revenue.

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Hindusthan Samachar / Jun Sarkar