India is bullish on green hydrogen as a future fuel, but export demand is falling behind expectations. Experts say policy uncertainty and geopolitical headwinds are slowing momentum, even as domestic players invest heavily in the sector.
ReNew’s Project Highlights Promise
ReNew, a leading renewable energy firm in India, is building a major green ammonia plant in Odisha. The project is designed for export markets, but company officials have acknowledged the hurdles in securing reliable offtake agreements.
“The infrastructure is coming up, but the market is not yet ready,” said a senior ReNew executive. “Buyers in Europe and Asia are holding back because of uncertain subsidies and shifting government priorities.”
Green hydrogen, produced using renewable electricity and water, is touted as a key tool to decarbonize sectors like steel, fertilizer, and heavy transport. India’s long-term goal is to become a global hub for production and export.
Government Stays Confident
Despite market uncertainty, the central government remains optimistic. Speaking at an industry event on Thursday, Ministry of New and Renewable Energy (MNRE) Secretary Santosh Kumar Sarangi said green hydrogen still has immense potential.
“One key factor, from an entrepreneur’s perspective, is market visibility,” Sarangi said. “That market — due to geopolitical tensions and policy backtracking by some governments, including the US where the Inflation Reduction Act (IRA) is stalled — has created skepticism.”
He acknowledged the challenge of unclear global demand but maintained that long-term fundamentals remain strong.
Export Ambitions Hit by Global Setbacks
India’s National Green Hydrogen Mission, launched in 2023, aims to produce 5 million metric tonnes of green hydrogen annually by 2030. However, that vision depends largely on exports.
Europe, a key target for Indian producers, is facing its own energy crunch and inflation. Meanwhile, US policy delays around the IRA have added to market hesitancy.
A recent report by the International Energy Agency (IEA) noted that only a fraction of announced global hydrogen projects had reached the final investment stage, mostly due to demand-side delays.
Domestic Market Push Could Help
With export uncertainties looming, some industry leaders are urging the government to stimulate domestic demand.
“We need policies that push for green hydrogen use in India,” said Sujoy Ghosh, an energy economist. “Subsidies, mandates, and long-term contracts for public sector units could give producers a safety net.”
The government is exploring blending mandates for hydrogen in refineries and fertilizer plants. Pilot projects are also underway in the rail and shipping sectors.
What Lies Ahead?
India is among a handful of countries with the solar and wind capacity to lead in green hydrogen production. But without long-term buyers — especially overseas — projects may stall or slow down.
“The ambition is there, and the groundwork is being laid,” said ReNew’s project lead in Odisha. “But unless global markets stabilize, especially in the EU and US, we’ll have to rely more on domestic use cases to build scale.”
A Call to Secure the Future
Industry stakeholders want the government to fast-track policy clarity, build port infrastructure, and sign bilateral agreements with buyers.
Meanwhile, companies like ReNew, Reliance, and Indian Oil are pushing ahead. The question now is not whether green hydrogen is viable — but whether the world is ready to buy.
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