Navigating India's Hydrogen Strategy: Balancing Costs, Technology, and Policy for Global Competitiveness
Key Ideas
  • India faces challenges in hydrogen production due to high costs of grey and blue hydrogen linked to imported natural gas.
  • Green hydrogen, though currently more expensive, is projected to reach competitive prices of ~$2/kg by 2030 with policy support and renewable expansion.
  • Strategic focus areas for India's hydrogen strategy include electrolyzer localization, cluster production, and policy development to align with global standards.
  • The report emphasizes the importance of balancing technology maturity, feedstock availability, and infrastructure readiness to realize India's green hydrogen ambitions and secure a stake in the growing market.
India's hydrogen production landscape is undergoing significant changes as the country tackles challenges related to high costs of grey and blue hydrogen, primarily due to reliance on imported natural gas. The article highlights the shift towards green hydrogen, which is currently more expensive but is expected to become cost-competitive by 2030, with the target price being around $2 per kilogram. Policy support and aggressive expansion of renewable energy sources are essential drivers for this cost reduction. The report emphasizes the importance of balancing technology maturity, feedstock availability, and infrastructure readiness in India's hydrogen strategy. Localization of electrolyzer production, strategic cluster development, and robust policy frameworks are identified as crucial pillars for India to align with global standards and secure a position in the expanding green hydrogen market, which is forecasted to exceed $100 billion. Leveraging biomass gasification from agricultural residue presents a decentralized pathway for hydrogen production in India. The article also stresses the significance of cost competitiveness, urging India to integrate best global practices, adopt localized solutions, and enhance production efficiency through scale-driven cost reductions. Policy clarity, cross-sector coordination, regional incentives, and renewable energy integration will play pivotal roles in India's journey to capture a share of the global green hydrogen trade market. The article underscores that India's success in integrating hydrogen across industries like refining, fertilizer, steel, and mobility will be key to scaling demand. Ultimately, the convergence of public and private investments, innovation ecosystems, and international partnerships will shape India's position as a leader in the hydrogen economy.
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