India aspires to be a global hub for green hydrogen and its derivatives. In light of recent export contracts, examine the opportunities and constraints.

The National Green Hydrogen Mission (NGHM) was approved in January 2023 with an outlay of ₹19,744 crore. It aims to make India a "global hub for production, usage and export" of green hydrogen and its derivatives [2]. AM Green was the sole winner of H2Global's Asian lot and will supply RFNBO ammonia to Germany for 10 years, worth at least €585 million [1]. This shows the goal becoming a real business, but it also shows the limits India still faces.

Opportunities

• Assured offtake: The buyer, Hintco, can also purchase extra volumes from what it earns reselling the ammonia in Europe [1]. A fixed long-term buyer makes these projects easier to finance.
• Cost competitiveness: SECI's first green ammonia auction found a price of ₹55.75/kg. The 2024 H2Global auction had found ₹100.28/kg [3]. The two are not directly comparable, because the H2Global price covers ammonia delivered to Europe under EU certification. Even so, Indian costs look competitive.
• Investment and scale: NGHM expects over ₹8 lakh crore of investment [2]. Export contracts help build larger plants, and larger plants lower the cost per tonne for Indian buyers too.
• Climate and energy security: By 2030 the mission expects to avoid about 50 MMT of CO₂ a year and cut fossil fuel imports by ₹1 lakh crore [2].

Constraints

• Cost gap: Green hydrogen still costs two to three times as much as grey hydrogen made from natural gas [7].
• Cost of finance: Borrowing costs more in developing economies, and this is a major reason green hydrogen is costlier there [6].
• Scale gap: Tenders so far cover 4.12 lakh tonnes a year of green hydrogen [4]. That is only about 8% of the 5 MMT target [2].
• Following EU rules: Only ammonia that meets the EU's RFNBO rules qualifies, and any extra volumes depend on European resale prices [1]. India's exports therefore depend on rules and markets outside its control.
• Home use versus exports: SIGHT Component II is meant to make Indian fertilizer production green [5]. If the cheapest green ammonia goes abroad, the emission cuts count for Germany, not India.

Overall, export contracts give India assured buyers, lower costs and investor confidence, but high costs, costly finance and EU rules still hold the sector back. India should use exports to build the industry rather than treat them as the final goal. Useful steps would be getting the EU to accept Indian green certification, having SECI keep pooling demand into large auctions, and offering H2Global-style long-term purchase contracts at home. Together these can make India a global hub while also meeting its Net Zero 2070 goal and SDG 7.