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EconomicsSource: Down To Earth

India can redirect fossil fuel incentives, introduce industry use mandate to lead global green hydrogen market: Report

Monday, 25 August 2025
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Key Points

India is set to lead the global green hydrogen market by targeting a 10% share and exporting 10 million tonnes annually by 2030. This development is crucial for UPSC aspirants focusing on GS Paper 3, which covers economic development and environmental issues. Last Updated: 2025-08-25

Key Facts About India's Green Hydrogen Strategy

  • Market Leadership: Capture 10% of the global Green Hydrogen market by 2030.
  • Emission Reduction: Facilitate a reduction of 50 MMT of CO₂ annually.
  • Production Capacity: Develop a capacity of 5 MMT per annum by 2030.
  • Job Creation: Generate over 600,000 green jobs in the GH2 value chain.
  • Cost Barrier: Early-stage Green Hydrogen costs are $4–4.5/kg.
  • Access to Capital: High initial investment deters private sector involvement.
  • Infrastructure Gaps: Lack of transport pipelines and storage facilities hampers adoption.
  • Economic Viability Issues: Delayed carbon pricing undermines Green Hydrogen's competitiveness.

India's Strategic Green Hydrogen Ambitions

The push towards green hydrogen is a significant step in aligning with India's economic and environmental goals. By focusing on renewable energy, India aims to reduce its carbon footprint and enhance energy security. The country is poised to become a key player in the global green hydrogen market, potentially exporting to regions like the EU, Japan, and South Korea. This aligns with India's commitment to sustainable growth and international climate agreements.

Related Government Schemes/Policies

  • National Hydrogen Mission: Aims to make India a global hub for green hydrogen production.
  • Green Hydrogen Purchase Obligations: Mandates the use of green hydrogen in specific industries.
  • Carbon Pricing Initiatives: Introduces carbon taxes to promote green hydrogen competitiveness.

UPSC Relevance

  • GS Paper 3: Economic development, environmental conservation, and technology.
  • Prelims: Questions on India's green hydrogen targets, market share, and related policies.
  • Mains: Essays on sustainable development, energy security, and climate change strategies.
  • Optional Subjects: Geography, Economics, and Environmental Science.

FAQ Section

  • What is Green Hydrogen? Green hydrogen is hydrogen produced using renewable energy sources, such as wind or solar power, making it a clean and sustainable energy carrier.
  • Why is Green Hydrogen important? It is crucial for reducing carbon emissions, enhancing energy security, and fostering economic growth through new job creation and technological innovation.
  • What are the key features of India's Green Hydrogen strategy? Key features include capturing a 10% global market share, reducing 50 MMT of CO₂ annually, and creating over 600,000 green jobs by 2030.

Detailed Coverage

  • Market Leadership: Capture 10% of the global Green Hydrogen market by 2030.
  • Emission Reduction: Facilitate a reduction of 50 MMT of CO₂ annually.
  • Production Capacity: Develop a capacity of 5 MMT per annum by 2030.
  • Job Creation: Generate over 600,000 green jobs in the GH2 value chain.
  • Cost Barrier: Early-stage Green Hydrogen costs are $4–4.5/kg.
  • Access to Capital: High initial investment deters private sector involvement.
  • Infrastructure Gaps: Lack of transport pipelines and storage facilities hampers adoption.
  • Economic Viability Issues: Delayed carbon pricing undermines Green Hydrogen's competitiveness.
  • Pricing Carbon: Implement carbon tax to level the playing field.
  • Obligation Mandates: Enforce Green Hydrogen Purchase Obligations in hard-to-decarbonize sectors.
  • Widen Infrastructure Base: Expand electrolyser capacity and establish export corridors.
  • Economic Reallocation: Redirect fossil fuel subsidies to Green Hydrogen initiatives.
  • Risk Pooling: Create pooled procurement platforms for competitive pricing.
  • Collaboration: Foster innovation through partnerships among government, industry, and researchers.
  • Global Export: Potential to export to the EU, Japan, and South Korea.
  • Strategic Advantages: Significant opportunities to capture market share and drive sustainability.
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Practice Questions

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What term is used to describe the collective challenges faced by India in its pursuit of a Green Hydrogen economy, which include high production costs, limited access to capital, infrastructure gaps, and issues related to economic viability, thus encapsulating the multifaceted nature of the obstacles that need to be addressed?