At a glance
- Cost compression and infrastructure readiness are decisive factors in India's green hydrogen ambition.
- The SIGHT scheme will decide whether India owns electrolyser manufacturing and gains pricing power, or remains dependent on imported technology.
- Scale will depend on India's ability to integrate energy, water, and logistics while securing export contracts.
Assessing India's green hydrogen ambitions
India has allocated ₹17,490 crore through the Strategic Interventions for Green Hydrogen Transition (SIGHT) programme to resolve a single, high-stakes question: can green hydrogen be made cheaper than the fossil fuel it must replace? The first tranche will tell us whether that bet is well-structured.
Green hydrogen is produced via electrolysis powered by renewable energy, making it climate-neutral across its production cycle. Grey hydrogen, by contrast, is produced from fossil fuels, primarily natural gas via steam methane reforming. With incentives and declining renewable tariffs, India is targeting cost parity between green and grey hydrogen by 2030, in line with targets set under the National Green Hydrogen Mission (NGHM).
SIGHT targets two strategic levers: domestic electrolyser manufacturing and large-scale green hydrogen production. India's competitive strategy requires its electrolyser ecosystem to scale rapidly in line with deployment cycles, using critical components produced indigenously to reduce costs without compromising quality, efficiency, or reliability.
The first two tranches under Mode 1 of SIGHT have awarded a combined annual production capacity of 862,000 tonnes, roughly 17% of the 5 MMT the NGHM has set as India's 2030 goal. Beyond production targets, SIGHT also works to close the infrastructure gaps that could constrain delivery: supply chain bottlenecks, transport connectivity, and water access all require parallel resolution if that capacity is to be commercially operational, not just nominally awarded.
Green hydrogen as a strategic opportunity
Falling renewable tariffs are closing the cost gap between green and grey hydrogen.
Cost parity is no longer a question of whether, but when.
The production of green hydrogen for export has emerged as a strategic lever for India's economic growth. With demand rising to meet decarbonisation goals across global supply chains in steel, fertilisers, refining, mobility, and chemicals, India aims to export green hydrogen at globally competitive prices, backed by cheap solar and wind power and a fast-scaling domestic manufacturing base. Cost parity with grey hydrogen, achieved at scale, would simultaneously reduce India's fossil-fuel import exposure and underpin an export-oriented, low-carbon industrial base.
SIGHT is the primary vehicle for mobilising private capital at scale. Global demand signals, from EU decarbonisation mandates to Japanese import frameworks, are reinforcing the export case. By driving demand aggregation and incentivising innovation while mitigating risks, the government is laying the path to durable commercial outcomes: narrowing the green-grey hydrogen cost gap, managing resource constraints such as water, enabling export readiness, and ensuring that public subsidies deliver commercially viable results.