Coal gasification industry seeks assured buyers, cheaper financing to unlock investments

India's coal gasification industry has called for easier access to long-term financing, assured buyers and faster project clearances to make investments commercially viable, as the government steps up efforts to gasify 100 million tonnes of coal annually by 2030. Coal gasification converts coal into synthesis gas, or syngas, which can be processed into products such as methanol, ammonia, fertilisers and synthetic natural gas. The government is promoting the technology to increase the value derived from domestic coal and reduce import dependence. Amrit Lal Meena, chairman of the Gasification Technologies & Research Council of India (GTRC-India) and former coal secretary, said investors needed greater certainty on financing, feedstock availability and sales of products manufactured through coal gasification. "Coal gasification projects need long-term financing with repayment moratoria, credit guarantees and predictable disbursal of government incentives. Recognising these projects as infrastructure under the National Infrastructure Pipeline could also improve access to affordable credit," Meena said at the Gasification India 2026 conference on October 22. On the demand side, he called for long-term purchase agreements with fertiliser, gas, chemical and steel companies to make projects bankable. Offtake guarantees and price-stabilisation mechanisms could also support initial projects, he said. The industry's demands come as the government pursues two separate incentive schemes for coal gasification. The earlier Rs 8,500-crore scheme, approved in January 2024, supports eight projects expected to gasify around 12 million tonnes of coal annually. The new Rs 37,500-crore scheme, approved in May 2026, targets the gasification of about 75 million tonnes of coal and lignite and is expected to mobilise Rs 2.5-3 lakh crore in investment. The industry has also called for long-term coal supply contracts specifying quantity, quality, pricing and delivery schedules, alongside reliable water, power and transport infrastructure. Coordinated support for land acquisition and statutory clearances would help projects progress faster, stakeholders said. Peeyush Kumar, managing director of Bharat Coal Gasification and Chemicals Ltd (BCGCL), a joint venture between Coal India Ltd and Bharat Heavy Electricals Ltd (BHEL), said project cost optimisation, engineering, procurement and construction capabilities, and project management would be critical to execution. He also flagged the need to account for coal washing and high ash content in policy design, saying these factors affected project costs and returns.