Coal gasification could cut India's import reliance, but costs remain a hurdle

what happened

According to Moody's, at the Gasification India 2026 conference in New Delhi, a Jindal Steel executive said domestic sourcing now covers about 90% of equipment needs for the company's ongoing gasification expansion, up from roughly 55% at the earlier plant. The company plans to make gasifiers within India, use steel from its own mill, and is evaluating a switch from the Rectisol process to pressure swing adsorption (PSA) for syngas-based direct reduced iron.

Air Products engineers said high ash content in Indian coal significantly affects project economics. Based on an internal assessment, raising ash from 16% to 32% lifts coal consumption by roughly 34-35% and oxygen consumption by about 20% for the same syngas output. Speakers also described gasification as a transitional step, since without carbon capture and storage its emissions could remain comparable to conventional coal processes.

why it matters

For markets, this is mainly an industry story. If equipment localisation and capital cost reductions advance faster, gasification could gradually reduce India's reliance on imported inputs and technology, but high investment needs and rising decarbonisation pressure on steelmakers still constrain commercial deployment.

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