Coal Gasification Scheme: Ministry Says ‘No Takers’ Reports Are Premature
Suman Munshi | IBG NEWS
New Delhi, September 5, 2026: The Ministry of Coal has rejected reports suggesting that the Centre’s ₹37,500-crore Scheme for Promotion of Surface Coal/Lignite Gasification Projects has failed to attract applications, saying that any such assessment is premature because the first application window is still open.
The scheme was approved by the Union Cabinet on May 13, 2026, with a total financial outlay of ₹37,500 crore. It seeks to accelerate coal and lignite gasification in India and encourage the conversion of domestic coal and lignite into higher-value products such as syngas, methanol, ammonia and urea.
According to the Ministry, the initiative is intended to make greater use of domestic resources, reduce dependence on imported feedstock and strengthen India’s energy and economic security.
Government conducted outreach before inviting applications
Following Cabinet approval, the Ministry undertook extensive consultations with potential project developers and other stakeholders. Roadshows were organised in New Delhi on May 28, Hyderabad on June 11 and Mumbai on June 18.
The outreach programmes brought together representatives from state governments, public and private sector companies, technology providers, investors, financial institutions and other stakeholders. The Union Minister of Coal and Mines and senior Ministry officials also participated in the programmes.
The Ministry subsequently issued the Request for Proposal (RFP) on July 7, 2026, followed by the launch of an online application portal.
A pre-application conference was held on July 20 to address questions from prospective applicants regarding eligibility, scheme provisions and the application procedure.
First application deadline is September 7
The Ministry pointed out that the first-round application deadline is September 7, 2026. Therefore, the final number of applications under the first round cannot be determined until the application window closes.
The Ministry said reports claiming that the scheme has received “no takers” do not reflect the current position. It further stated that, based on discussions with stakeholders, Talcher Fertilisers Limited (TFL) and NTPC Limited have already submitted applications through the online portal.
The Ministry is also engaging with other potential applicants who are reportedly at different stages of project preparation and finalisation of their applications.
Large projects require extensive preparation
The government has highlighted the complexity and scale of the projects envisaged under the scheme. Potential applicants need to undertake considerable preparatory work, including Pre-Feasibility Reports, technology assessments, feedstock arrangements, project economic evaluations and detailed project proposals.
Consequently, the Ministry expects additional companies to complete their preparations and submit applications as the September 7 deadline approaches.
Rolling application system to provide more opportunities
The scheme has also been designed with multiple application opportunities rather than a single fixed window.
Applications will be invited through rolling rounds. Once one application round closes, the next round will open from the following day and remain available for two months.
The Ministry said this mechanism has been incorporated to ensure that companies requiring additional time for project preparation are not excluded from the scheme because they cannot participate in an earlier round.
Scheme aims to trigger up to ₹3 lakh crore investment
The Centre expects the initiative to generate substantial investment and employment. According to the Ministry, the scheme could potentially catalyse investments of approximately ₹2.5 lakh crore to ₹3 lakh crore across nearly 25 projects.
It is also expected to create around 50,000 direct and indirect employment opportunities.
The initiative forms part of the government’s broader objective of establishing 100 million tonnes of coal gasification capacity by 2030.
Ministry confident of industry participation
The Ministry of Coal stressed that the scheme is still at an early stage of implementation and that the first application window remains open until September 7.
It said participation should therefore be assessed only after the prescribed application process and subsequent rounds have progressed, rather than on the basis of an interim assessment.
The Ministry expressed confidence that the scheme will attract sustained participation from industry and provide a significant boost to the development of coal and lignite gasification capacity in India.
