Green hydrogen is central to decarbonising India's hard-to-abate sectors. Examine the potential and the constraints of the National Green Hydrogen Mission.

Green hydrogen is hydrogen made by electrolysis of water using renewable power. In fertiliser, refining, steel and shipping, hydrogen is a raw material or a reductant that electricity cannot replace, so green hydrogen is the main clean option there. The National Green Hydrogen Mission (NGHM; MNRE, 2023; ₹19,744 crore) [1] has real potential, but cost, demand and resource limits will decide whether it succeeds.

Potential

• Climate and scale: It targets at least 5 MMT a year by 2030 and would avert about 50 MMT of CO₂ a year, supporting Net Zero 2070 [2].
• Energy security: It is expected to cut fossil fuel imports by about ₹1 lakh crore by 2030 [2]. Green ammonia can replace imported grey ammonia in fertiliser plants.
• Falling prices: SECI's first green ammonia auction under SIGHT found a price of ₹55.75/kg, against ₹100.28/kg in the 2024 H2Global auction [3]. Bids across 13 fertiliser plants ranged from ₹49.75 to ₹64.74/kg [4].
• Manufacturing and jobs: SIGHT (₹17,490 crore) [1] supports electrolyser manufacturing. The mission expects over 6 lakh jobs [2].
• Export credibility: Green hydrogen hubs at Kandla, Tuticorin and Paradip and the Green Hydrogen Standard (≤2 kg CO₂e per kg H₂, well-to-gate) make Indian output certifiable and tradable [5].
• Demonstration: India's first hydrogen train now runs on the 89 km Jind–Sonipat section [6].

Constraints

• Prices still depend on subsidy: The auction prices include SIGHT incentives and waived inter-state grid charges. Green hydrogen still costs more than grey hydrogen made from natural gas.
• Awards are not output: By May 2025, 8,62,000 tonnes a year of capacity had been awarded to 19 companies [5]. That is only about 17% of the target, and an award is a promise to build, not a working plant.
• Funding cliff: Mission funding ends in FY 2029–30 [1], the same year as the target, which makes investors hesitant.
• Thin demand: Buying is mostly through government auctions. The 7.24 lakh tonnes a year ammonia tender [4] is small next to a 5 MMT goal, and private firms face no rule to buy green hydrogen.
• Water stress: Electrolysis needs purified fresh water, but the best solar land, such as Rajasthan, is short of water.
• Capital and safety: Most of a plant's cost is paid up front, so interest rates largely set the final price. Hydrogen is also hard to store and move, and it needs strict safety licensing, as with PESO at Jind [6].

NGHM has moved green hydrogen from ambition to real price discovery, but it is not yet commercially viable without support. The way forward is to:

• require fertiliser and refining firms to buy a share of green hydrogen;
• use credit guarantees and blended finance to lower borrowing costs;
• require desalinated water at the coastal hubs;
• give clear policy signals beyond 2030;
• reserve green hydrogen for hard-to-abate uses first.

With these steps, NGHM can deliver on SDG 7 and SDG 13 and India's Net Zero 2070 pledge.