The ₹37,500 crore Coal Gasification Scheme has received seven applications in its first round, marking an overwhelming response from industry participants. According to the Ministry of Coal, the confirmed applicants include Adani Enterprises (3 applications for urea projects), NTPC (synthetic natural gas project), Gallantt Ispat (direct reduced iron and syngas), Shyam Sel & Power (syngas production), and Talcher Fertilisers (urea production). This development comes after the Union Cabinet approved the scheme on May 13, 2026, providing the formal framework for private sector participation in coal gasification projects. The scheme builds on the ₹8,500 crore Financial Incentive Scheme approved in January 2024, under which eight gasification projects are currently under implementation. The first round closed on September 7, 2026, with the ministry confirming that seven applications received in the first round mark an overwhelming response from industry and represents a significant step towards implementing the scheme.
The Ministry of Coal has confirmed that seven applications received in the first round mark an overwhelming response from industry and represents a significant step towards implementing the scheme. According to Business Standard, Alok Kumar Singh, Advisor (Projects), Ministry of Coal, stated that "When we said reports of 'no takers' were premature, we were confident that industry would respond and it has, decisively. Seven applications in the very first round, including from some of India's largest industrial houses and public sector undertakings, are a clear vote of confidence in the scheme and in India's coal gasification mission. The market has spoken, and it has spoken loudly." The response comes amid earlier media reports flagging concerns over the ability of the government's flagship coal gasification programme to attract bidders. The ministry noted that given the scale of the projects involved, applicants require substantial preparatory work, including pre-feasibility studies, technology assessments, environmental considerations and detailed financial planning.
Under the scheme, financial incentives of up to 20% of the cost of plant and machinery are to be provided through a competitive bidding process. The incentive for an individual project is capped at ₹5,000 crore, while a group of entities can receive a maximum of ₹12,000 crore across multiple projects. The scheme seeks to promote conversion of domestic coal and lignite into higher-value products such as syngas, methanol, ammonia, urea and hydrogen, while reducing dependence on imports of LNG, urea, ammonia and methanol. The Request for Proposal (RFP) was issued on July 7, 2026, with the ministry conducting extensive outreach through roadshows in New Delhi on May 28, Hyderabad on June 11, and Mumbai on June 18, bringing together representatives from State Governments, public and private sector companies, technology providers, investors, financial institutions and other stakeholders. The second round of applications under the scheme opened on Tuesday, with the ministry stating that application windows will open every two months.
Adani Enterprises shares were trading in mixed territory on September 8, falling as much as 1.1% to hit an intraday low of ₹2,918 before recovering to trade 0.27% lower at ₹2,942 during afternoon sessions. The stock has climbed 3% in the past week but lost more than 2% over the month, with a 30% year-to-date gain. NTPC shares declined as much as 1% to touch the session's low of ₹328.65 before recovering slightly to trade 0.05% lower at ₹331.85. The stock has risen over 1% in the past week but fallen 3% over the month, with a nearly 2% year-to-date jump. Gallantt Ispat shares dropped as much as 2.8% to hit an intraday low of ₹556.30 before trading 1.63% lower at ₹563.10. The stock has surged 2% in the past week but declined 7% over the month, with a more than 4% year-to-date rise.
The gasification scheme addresses a critical vulnerability in India's energy security, as India's import bill for key substitutable products such as LNG, urea, ammonium nitrate, ammonia, coking coal and methanol stood at approximately ₹2.77 trillion in FY25. This dependence has been flagged as a vulnerability amid ongoing geopolitical tensions in West Asia. The ministry expects the scheme to catalyse investments of ₹2.5-3 trillion across nearly 25 projects and generate around 50,000 direct and indirect jobs. The government aims to achieve 100 million tonnes of coal gasification capacity by 2030, including 75 million tonnes under the new scheme. The initiative builds on the ₹8,500-crore financial incentive scheme approved in January 2024, with the scheme representing a comprehensive approach to reducing India's reliance on imported feedstock while promoting domestic coal utilization through higher-value product conversion. The synthetic gas produced through gasification can be used in fertiliser production, reducing natural gas imports.
