Business · India Bureau
Coal gasification could slash India's import bill by ₹1.96 trillion annually
Domestic production of gasification-derived products could significantly reduce India's reliance on imports of natural gas, urea, ammonia and methanol. The shift could also catalyse new industrial clusters and employment opportunities across the country.
LSN India ·
India's energy and chemical sectors could unlock substantial economic benefits through expanded coal gasification, according to analysis by consulting firm Alvarez & Marsal. The technology converts coal into synthesis gas, which can then be processed into multiple high-value products currently requiring large-scale imports.
The potential import substitution spans several critical commodities. Natural gas, urea, ammonia and methanol together represent a significant portion of India's annual import expenditure. By developing domestic gasification capacity, India could reduce its dependence on foreign suppliers while strengthening domestic supply chains.
Beyond import savings, coal gasification presents broader economic opportunities. The sector could facilitate the emergence of new industrial clusters in coal-rich regions, particularly in central and eastern India. This geographic diversification of manufacturing would support job creation across multiple skill levels, from technical roles to supporting services.
The analysis underscores coal gasification's potential as a strategic industrial tool during India's energy transition period. While the country pursues renewable energy expansion, gasification technology could optimise existing coal resources and support industrial decarbonisation objectives through cleaner conversion processes and reduced import dependency.