The Government has accelerated the rollout of policy, financial and infrastructure measures under the National Green Hydrogen Mission (NGHM) to position the country as a global hub for the production, consumption and export of green hydrogen and its derivatives. With a clear focus on lowering costs and ensuring stable demand, the Centre aims to scale India’s green hydrogen production capacity to 5 million metric tonnes per annum (MMTPA) by 2030.
Incentives Drive Domestic Electrolyser Manufacturing
To strengthen the local supply chain, the government has introduced production-linked incentives for electrolyser manufacturing. So far, 15 companies have been awarded a combined manufacturing capacity of 3,000 MW per annum, backed by incentives worth ₹4,440 crore. This push is expected to reduce import dependence and bring down the cost of green hydrogen production over time. By expanding domestic manufacturing, the government aims to create a robust ecosystem for large-scale deployment.
Production and Offtake Commitments Take Shape
At the same time, the government is focused on building demand visibility through assured offtake. Authorities have allocated green hydrogen production capacity of 8.62 lakh tons per annum to 18 companies. Additionally, two companies have secured 20,000 tons per annum for supplying green hydrogen to refineries, supporting industrial decarbonisation. Further strengthening the market, the Solar Energy Corporation of India (SECI) has discovered prices for 7.24 lakh tonnes per annum of green ammonia supply to 13 fertiliser plants. These long-term contracts provide predictable demand for one of the most important green hydrogen derivatives.
Transmission and Duty Benefits to Lower Costs
To improve project viability, the government has introduced several cost-reduction measures. Green hydrogen and green ammonia projects commissioned on or before December 31, 2030, and powered by renewable energy, will receive a 25-year waiver on Inter-State Transmission System (ISTS) charges from the date of commissioning. Additionally, duty benefits under the SEZ Act, 2005, have been extended to renewable energy equipment installed exclusively for captive consumption, further reducing capital costs for developers.
Renewable Energy Expansion Supports Hydrogen Scale-Up
Recognising that low-cost renewable power is critical for competitive hydrogen production, the government is rapidly expanding clean energy capacity.
Key measures include:
*Standard bidding guidelines for tariff-based procurement of solar, wind, hybrid and firm renewable energy projects
*Exemptions from ALMM and RLMM requirements for renewable energy plants supplying power exclusively to hydrogen units in SEZs and EOUs
*Allowing up to 100 percent foreign direct investment (FDI) under the automatic route
In parallel, authorities are developing large solar parks, ultra-mega renewable energy projects and strengthening grid infrastructure through the Green Energy Corridor Scheme. A comprehensive transmission plan through 2030 has also been prepared to support future renewable capacity growth.
Enabling Industrial Decarbonisation
Together, these measures aim to create a competitive and investment-friendly green hydrogen ecosystem. As reported by knnindia.co.in, by combining manufacturing incentives, assured demand, lower transmission costs and expanded renewable supply, the government seeks to accelerate industrial decarbonisation, attract global investments and establish India as a leading exporter of green hydrogen and green ammonia. As policymakers intensify their push, green hydrogen is emerging as a central pillar of India’s clean energy transition and long-term energy security strategy.
