NEW DELHI: India has greenlit a nearly $4 billion initiative to boost coal gasification, a cleaner way to use coal, as it seeks to tackle energy supply challenges brought on by the ongoing conflict in the Middle East.
On Wednesday, Prime Minister Narendra Modi’s cabinet approved a $3.92 billion plan aimed at converting coal and lignite into synthetic gas, according to a government announcement.
Coal gasification takes lower-grade coal like lignite and turns it into gas that can be used for generating electricity. This method is regarded as more environmentally friendly compared to traditional coal burning, and it also has the potential to produce fertilizers.
The initiative aims to enhance energy security and reduce dependency on imported fuels, including liquefied natural gas (LNG), about half of which India brings in from abroad.
“This scheme represents a significant advancement in accelerating India’s coal and lignite gasification efforts,” the statement noted, highlighting a target to gasify 100 million tonnes of coal by 2030.
As the world’s most populous nation, India ranks as the fourth-largest importer of LNG and the second-largest buyer of liquefied petroleum gas (LPG), much of which is sourced from the Middle East.
The gasification program is also designed to diversify the use of coal and lower imports of various fertilizers, such as urea, ammonia, and ammonium nitrate.
Last year, India’s spending on these imported products reached around 2.77 trillion rupees, approximately $32.6 billion.
India boasts roughly 401 billion tonnes of coal reserves, among the largest in the world.
The conflict in the Middle East has added strain to the Indian economy, which heavily relies on energy and fertilizers from the region, casting a shadow over economic growth prospects in Delhi.
