India’s $2.8 Billion Green Hydrogen Opportunity
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- Published 24 Apr 2026
Energy does not usually make for exciting conversation. But when a country spends over $190 billion a year importing it, the numbers start to demand attention.
That is roughly what India's energy import bill looked like in 2024.
A significant portion of that goes toward fossil fuels, which also power a large part of India's industrial base: steel, fertilisers, refineries, and shipping.
The exposure is broad, and for decades, there has been no credible way to reduce it.
Green hydrogen is now being positioned as that answer.
The idea itself is not complicated.
Use solar or wind energy to split water into hydrogen and oxygen.
The hydrogen you get is clean, energy-dense, and can substitute for fossil fuels across sectors that are otherwise very hard to decarbonise.
What makes it interesting for India specifically is the cost equation.
Solar and wind tariffs here are among the lowest in the world, and the country receives between 2,300 and 3,200 hours of strong sunlight annually.
That translates into lower energy inputs and, ultimately, lower hydrogen production costs.
The scale of what is being attempted is worth pausing on.
The global green hydrogen market stands at $8.8 billion today and is projected to reach $199 billion by 2034, growing at a compounded annual rate of around 41.5%.
India's domestic market is expected to grow even faster, at roughly 56% annually between 2024 and 2030, reaching $2.8 billion by the end of that period.
Total investment potential in the sector is estimated at over ₹8 lakh crore.
This reflects the convergence of policy, industrial demand, and a global push to decarbonise sectors that electricity cannot easily reach.
Steel production is one of the largest use cases.
Traditionally dependent on coal, it is also among the most carbon-intensive processes.
Green hydrogen offers a pathway to replace coal in iron-making, directly addressing emissions at the source.
Fertilisers present another large opportunity.
Ammonia production today relies heavily on natural gas. Switching to green hydrogen changes the input economics while reducing dependence on imported fuel.
Refineries already use hydrogen, but most of it is “grey”, produced from fossil fuels.
Transport and shipping are further out on the adoption curve, but remain critical.
These are sectors where electrification is not always practical, making hydrogen-based fuels a necessary alternative over time.
Together, these industries are expected to anchor the first wave of demand.
However, India’s ambition goes beyond just domestic use.
The country is targeting a ~10% share of the global hydrogen market by 2030, with export demand expected from the EU, Japan, and South Korea.
This creates two levers. Exports of $3-5 billion, and import substitution worth $7-15 billion.
The shift, therefore, is not just about cleaner energy but also about improving trade balances and building a new export category.
But scaling this is not straightforward.
Costs remain high due to expensive electrolysers and renewable infrastructure.
Storage and transport systems are still underdeveloped, while water availability is a constraint in renewable-heavy regions.
Critical minerals like platinum and iridium are largely imported.
And the sector needs 60-80 GW of reliable renewable power to operate at scale.
In effect, the technology is ready, but the ecosystem is still catching up.
This is where policy becomes central to execution.
India’s National Green Hydrogen Mission (2023) has an outlay of ₹19,744 crore, targeting 5 MMT production by 2030.
The expected impact includes ~50 MMT CO₂ reduction, ₹1 lakh crore in import savings, and 5-6 lakh jobs.
To support this, the government has introduced the SIGHT scheme, which provides incentives for both hydrogen production and electrolyser manufacturing.
Alongside this, hydrogen hubs, pilot projects, and research initiatives are being developed to address gaps in infrastructure and technology.
With the ecosystem taking shape, companies are moving in to scale this opportunity.
Reliance Industries Ltd, Larsen & Toubro Ltd, and NTPC Ltd are investing across production and infrastructure.
Energy PSUs like Indian Oil Corporation Ltd, Bharat Petroleum Corporation Ltd, and GAIL (India) Ltd are integrating hydrogen into existing systems.
Renewable and transmission players like Adani Enterprises and Power Grid Corporation of India Ltd complete the ecosystem.
Stepping back, green hydrogen sits at the intersection of three things: energy independence, industrial decarbonisation, and export competitiveness.
If executed well, India can move from an energy importer to a clean energy exporter.
Sources:
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