Inexperienced hydrogen might play a key function in India’s clear power transition, notably in sectors the place direct electrification is tough.
Inexperienced hydrogen (GH) is produced by splitting water utilizing renewable power, whereas gray hydrogen is made out of pure gasoline, releasing vital carbon dioxide emissions. GH can substitute gray hydrogen in fertilizers and refineries, coal in steelmaking, and fossil fuels in elements of the chemical substances, petrochemicals and heavy transport sectors, together with delivery. Moreover lowering emissions, it will possibly decrease dependence on imported fossil fuels and industrial feedstocks, restrict publicity to international value volatility and strengthen power safety. Nonetheless, large-scale adoption will rely upon prices, end-use effectivity, and supporting infrastructure.
Recognizing GH as a strategic power provider, the federal government of India launched the Nationwide Inexperienced Hydrogen Mission (NGHM) in January 2023. The mission goals to make India a worldwide hub for GH manufacturing, use and exports, with a goal of at the very least 5 million tonnes (Mt) of annual manufacturing by 2030.
By December 2025, the federal government had awarded incentives for 0.862 million tonnes each year (MTPA) of manufacturing capability and three,000 MW each year of electrolyzer manufacturing. The awarded GH manufacturing capability represents solely about 17 p.c of the 2030 goal.
Price stays a serious barrier to large-scale GH adoption within the home market. The Worldwide Vitality Company (IEA) has additionally highlighted this problem. Its current report says unsure demand and challenge delays, partly attributable to sluggish infrastructure improvement, imply GH is unlikely to develop into cheaper than gray alternate options within the close to future.
To handle prices, NGHM gives short-term subsidies and coverage help to incentivize manufacturing. It has additionally recognized three ports – Deendayal, V.O. Chidambaranar and Paradip – as GH hubs to coordinate manufacturing, storage, dealing with and delivery for potential exports.
Underneath NGHM, 174,900 million Indian rupees have been allotted to the Strategic Interventions for Inexperienced Hydrogen Transition (SIGHT) program. Declining manufacturing subsidies on GH (50 rupees to 30 rupees per kg) and inexperienced ammonia (8.8 rupees to five.3 rupees) can be found for under three years. They cowl solely 10-15 p.c of the green-grey value hole and are meant as a short lived incentive. Electrolyzer manufacturing incentives are unfold over 5 years, declining from 4,440 rupees to 1,480 rupees per kW.
Lengthy-term sustainability would require measures past subsidies. These embrace creating demand in hydrogen-consuming industries by way of a Inexperienced Hydrogen Manufacturing Obligation; lowering manufacturing prices by way of cheaper renewable power and home electrolyzer manufacturing, supported by performance-linked incentives; and growing export markets together with carbon pricing for gray hydrogen
Renewable power is a serious value element (50-70 p.c of GH manufacturing prices), notably when round the clock provide is required. To decrease manufacturing prices, encourage home adoption and strengthen India’s export competitiveness, the federal government has notified the waiver of Inter-State Transmission System (ISTS) expenses for eligible GH and inexperienced ammonia initiatives.
In line with WITS information, India imported hydrogen value $871,700 in 2024, whereas exports amounted to $17,400. Nigeria was the biggest vacation spot for Indian hydrogen exports (45.8 p.c), adopted by Nepal, Bangladesh, Bhutan and Sri Lanka.
India has appreciable scope to increase its export community. Present estimates recommend that the European Union and East Asia might collectively import round 3.4-6 million tonnes of GH yearly by 2030. Nonetheless, these figures understate the rising GH market, as a result of they don’t distinguish hydrogen by electrical energy supply or embrace commerce in derivatives.
In July 2026, ACME Group (0.4 MTPA below NGHM) signed long-term provide agreements with Japan from its Paradip facility – 0.41 MTPA inexperienced ammonia for IHI and 1.0 MTPA inexperienced methanol for Mitsubishi Fuel Chemical.
India has additionally pursued hydrogen cooperation and export-infrastructure partnerships with Germany and different international locations.
Regardless of India’s substantial renewable power potential, the economics of large-scale GH manufacturing will rely upon land and water availability, and the price of renewable power technology and electrolyzers. Water-stressed areas will want credible sourcing and therapy plans, together with desalination the place essential.
Dependence on international provide chains for electrolyzers and renewable power gear additionally leaves GH manufacturing uncovered to concentrated manufacturing and demanding mineral dependencies.
One other problem is the space between renewable power technology facilities and designated GH hub ports. Kandla port, as an illustration, is comparatively near renewable-rich clusters in Gujarat and Rajasthan, whereas Paradip is significantly farther from such areas.
The space between renewable power sources and GH manufacturing amenities is, due to this fact, a essential consideration. Hydrogen might be produced utilizing renewable power wheeled from distant technology amenities by way of ISTS. Transporting GH over lengthy distances additionally poses financial challenges due to the excessive prices of compression (200-700 bar) or liquefaction (-253 levels C).
A probably extra viable choice is to transform GH into derivatives on the supply and transport them by way of current infrastructure. Decentralized use by close by refineries and fertilizer vegetation, ideally by way of blended pure gasoline pipelines, with solely surplus manufacturing exported as ammonia, might additional keep away from the price of transporting pure hydrogen.
Exports of GH and its derivatives can earn international change, scale back fossil gasoline import payments and assist initiatives obtain economies of scale. Whereas the home marketplace for these merchandise continues to be rising and price-sensitive, an export-oriented strategy might decrease manufacturing prices and costs, thereby stimulating home demand.
Export markets add their very own situations: EU consumers require EU guidelines for renewable fuels of non-biological origin (RFNBO) compliance, together with proof of renewable power sourcing. Certification and traceability should due to this fact be in-built from the outset, alongside product high quality, secure port operations and dependable supply.
Constructing a strong GH worth chain would require prioritizing aggressive manufacturing routes, concentrating on low-hanging functions the place hydrogen is already in use, and complementing coverage and monetary incentives with demand-creation measures.
India can develop into a regional and international provider of inexperienced hydrogen and its derivatives, however exports should reinforce – not distract from – the home transition. Success will rely upon aggressive low-emissions manufacturing, changing fossil-based inputs at house, securing dependable export consumers and delivering measurable emissions reductions.
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