India's Push for Green Hydrogen: Tariff Cuts and Export Plans
Key Ideas
- The Indian government is considering tariff cuts on machinery imports crucial for green hydrogen production, aligning with PM Modi's vision for India to be a leading green energy hub.
- Proposed tax benefits and lower GST on green hydrogen and ammonia are being discussed, focusing on fuel produced for exportation to boost India's position in the global market.
- Despite hurdles in technology scaling and cost reduction, Indian industrialists like Gautam Adani and Mukesh Ambani show interest in green hydrogen, with investments in the sector amounting to approximately USD 187 billion.
- India aims to increase its green hydrogen production from zero to 5 million tons by 2030, with export agreements mainly targeting Europe and Japan, signaling growing international interest in India's green hydrogen potential.
In a significant move towards advancing its green energy ambitions, the Indian government is looking into tariff reductions on machinery imports crucial for green hydrogen production. This step is in line with Prime Minister Narendra Modi's vision to establish India as a significant hub for eco-friendly fuel. Discussions include exempting certain equipment from import duties and lowering the goods and services tax on green hydrogen and green ammonia, with a focus on fuel meant for export rather than domestic use. Green hydrogen, produced through renewable energy, is key to India's plan to decarbonise heavy industries like refineries and steel mills. The country targets an increase in green hydrogen production from virtually zero to 5 million tons by 2030 to position itself as a major global supplier. Notable Indian industrialists, including Gautam Adani and Mukesh Ambani, are venturing into this emerging field. Investments in green hydrogen production in India are estimated at around USD 187 billion. Most export agreements are currently aimed at Europe and Japan, indicating rising international interest. To support sector growth, the finance ministry is considering preferential funding terms for green hydrogen projects. The proposed measures, if implemented, could significantly enhance India's goal of becoming a global leader in green hydrogen production and exportation.
Topics
India
Renewable Energy
Investment
Export Market
Policy Changes
Industrial Decarbonization
Tariff Reduction
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