Discuss how incentive schemes such as SIGHT under the National Green Hydrogen Mission are shaping domestic manufacturing of clean-energy equipment. What challenges remain?

The National Green Hydrogen Mission (NGHM) was approved on 4 January 2023 with an outlay of ₹19,744 crore and a target of 5 MMT of green hydrogen a year by 2030 [1]. Its main tool is SIGHT (Strategic Interventions for Green Hydrogen Transition), which gets ₹17,490 crore [1]. SIGHT is moving India from importing clean-energy equipment towards making it at home, but the policy has done more for factories than for hydrogen buyers so far.

How SIGHT is shaping domestic manufacturing

• Two-sided design: One incentive stream supports electrolyser manufacturing and another supports green hydrogen production, so equipment makers and hydrogen producers are funded together [1].
• Competitive bidding in tranches: In the first round, 8 companies won awards for 1,500 MW/yr of electrolyser manufacturing capacity [2]. By the later rounds, the total had grown to 15 companies and 3,000 MW/yr, backed by ₹4,440 crore of incentives [3].
• Production-side pull: Incentives have been awarded for 8,62,000 tonnes/yr of green hydrogen production capacity [4]. These plants will create orders for domestically made electrolysers.
• Wider equipment spillover: The mission needs about 125 GW of new renewable capacity [1]. That raises demand for solar modules, wind turbines and grid equipment.
• Strategic gains: The mission expects to save about ₹1 lakh crore in fossil-fuel imports [1]. Making the equipment in India also supports Aatmanirbhar Bharat in critical technologies.

Challenges that remain

• Electricity cost matters more than equipment cost: Round-the-clock renewable power makes up 50–70% of the cost of green hydrogen [5]. Cheaper electrolysers therefore address only the smaller part of the cost.
• Too few buyers: Hydrogen-based steel and cement are not yet commercially available [6]. Without buyers, new electrolyser factories may run below capacity.
• Large gap to the target: Production incentives so far cover about one-sixth of the 5 MMT goal [1][4].
• Limited funds: SIGHT's budget is fixed [1], so the government must choose between supporting equipment makers and supporting hydrogen demand.
• Technology gaps: Domestic research capacity on the core electrolyser component (the stack) is still weak, so dependence on imported technology may continue.

SIGHT has started a domestic electrolyser industry, but factories alone will not make the mission succeed. The next step should be demand-side support: purchase mandates and contracts-for-difference for steel and fertiliser plants, plus cheaper round-the-clock renewable power through storage and transmission. Together, these would help India reach its net-zero 2070 goal and SDG 7 on clean energy.