India to Invest ₹46,000 Crore in Coal Gasification Projects to Boost Domestic Production

New Delhi, October 23 (Daily Kiran) : The Indian government is set to accelerate coal gasification projects with a substantial investment of ₹46,000 crore. This initiative aims to boost domestic production of fertilizers and gas, thereby reducing reliance on imports.

During the ‘Agraasar Bharat Manch’ event in New Delhi, Union Minister of Coal and Mines G. Kishan Reddy emphasized the importance of coal as a vital industrial raw material. He outlined plans to convert coal into synthetic gas (syngas), ammonia, urea, and methanol through coal gasification. Currently, coal accounts for approximately 55% of India’s primary energy needs and contributes 74% to the country’s electricity generation. The government aims to promote commercial-scale coal gasification projects in the near future.

Recently, the Union Cabinet approved a financial provision of ₹37,500 crore to encourage surface coal gasification projects. This initiative is crucial for advancing the coal gasification program in India. The goal is to achieve a national target of gasifying 100 million tons of coal by 2030, enhancing energy security and reducing dependence on imports of liquefied natural gas (LNG), urea, ammonia, and methanol.

Reddy also mentioned that the government is working to increase domestic production of critical minerals while exploring and extracting mining assets abroad. He highlighted the essential role that these minerals play in manufacturing high-tech products such as electric vehicles (EVs), telecommunications equipment, solar energy units, and defense equipment. Ensuring a steady supply of these minerals is vital for India.

The minister noted that exploration is currently underway in mines in Argentina, and discussions with other countries are ongoing. The government is encouraging Indian entrepreneurs to engage in the exploration and processing of critical minerals overseas. In 2025, the Ministry of Mines signed a memorandum of understanding with the government of Catamarca province in Argentina to enhance cooperation in the exploration and resource development of critical minerals.

Reddy identified Argentina, which has vast lithium reserves, as a significant partner for India. Lithium is essential for electric vehicle batteries and renewable energy storage systems. Furthermore, the government is developing a rare earth element corridor in Kerala, Tamil Nadu, Andhra Pradesh, and Odisha. Reddy expressed optimism that India will achieve self-sufficiency in rare earth elements in the coming years. This initiative aims to increase the availability of critical minerals, strengthen domestic industrial capacity, and reduce import dependence in strategic sectors.