New Delhi, Oct 2026 : India is accelerating coal gasification projects with a proposed outlay of ₹46,000 crore to boost domestic production of fertilisers, gas and industrial chemicals, reduce import dependence and strengthen energy security, Union Coal and Mines Minister G Kishan Reddy said on Friday.
Addressing the 'Agrasar Bharat Manch' event in New Delhi, Reddy described coal as a crucial industrial raw material and said the government was expediting plans to convert it into synthetic gas (syngas), ammonia, urea and methanol through coal gasification technology.
Coal continues to meet around 55 per cent of India's primary energy requirements and accounts for nearly 74 per cent of its electricity generation, the minister said. He added that the government was working to promote commercial-scale coal gasification projects to unlock greater value from the country's coal resources.
The Union Cabinet has recently approved a scheme with a financial outlay of ₹37,500 crore to promote surface coal gasification projects. The initiative is intended to accelerate the country's coal gasification programme and help achieve the national target of gasifying 100 million tonnes of coal annually by 2030.
The programme aims to strengthen domestic manufacturing and reduce reliance on imports of key products, including liquefied natural gas (LNG), urea, ammonia and methanol. Coal gasification can also provide industrial feedstock for several sectors, supporting India's broader efforts to improve resource utilisation and energy security.
Reddy also highlighted the government's efforts to secure critical minerals through domestic exploration and overseas mining investments. These minerals are essential for emerging industries and technologies, including electric vehicle (EV) batteries, telecommunications equipment, solar power systems and defence hardware.
"We are currently exploring the mines of Argentina and simultaneously having discussions with other countries," Reddy said. He added that the government was encouraging Indian entrepreneurs to explore overseas opportunities in critical mineral exploration and processing.
In 2025, Mineral Exploration and Consultancy Limited (MECL), a public sector undertaking under the ministry, signed a memorandum of understanding with the provincial government of Catamarca in Argentina to deepen cooperation in critical mineral exploration and resource development.
Argentina, which possesses substantial lithium reserves, is an important partner for India as it seeks to secure supplies of minerals required for EV batteries and renewable energy storage systems, the minister said.
Reddy further announced that the government was developing a rare earth element corridor across Kerala, Tamil Nadu, Andhra Pradesh and Odisha. The initiative is aimed at strengthening India's capacity to explore, process and utilise rare earth resources.
Expressing confidence in the country's mineral prospects, the minister said India would move towards self-sufficiency in rare earth elements in the coming years.
The twin focus on coal gasification and critical mineral exploration reflects India's efforts to strengthen domestic production, diversify resource supplies and reduce dependence on imported energy products and strategic raw materials.
