The question isn’t whether India needs green hydrogen—it’s whether the country can deliver on its ambitious promises without repeating past renewable energy missteps. While government officials tout $2.4 billion investments and 5 million metric tons of annual production by 2030, ground reality reveals a familiar pattern: bold announcements, modest execution, and persistent cost challenges that could derail the entire transition.
India’s National Green Hydrogen Mission, launched in 2023, targets nearly 10% of projected global demand by the decade’s end. The stakes couldn’t be higher—success means transforming heavy industries and establishing energy export leadership, while failure risks another overpromised, underdelivered renewable initiative that damages credibility for years.
Mission targets look impressive on paper but execution lags
The National Green Hydrogen Mission, launched in January 2023 with a ₹19,744 crore budget and sweeping ambitions for 2030, aims for 5 million metric tons of annual production, 125 GW of additional renewable capacity, ₹8 lakh crore in investments, and 600,000 new jobs, while cutting 50 million tons of greenhouse gas emissions annually.
The phased roadmap prioritizes demand creation and domestic electrolyzer manufacturing through 2026, focusing on fertilizers, refineries, and city gas distribution. Phase two extends to steel, mobility, shipping, and aviation sectors while intensifying research and regulatory frameworks for market adoption.
By 2050, India’s hydrogen demand could reach 28 million tons, with the mission planning to meet 80% through green production. Green Hydrogen Hubs at major ports like Kandla, Paradip, and Tuticorin target industrial clusters and infrastructure readiness for large-scale adoption.
However, energy analysts highlight a critical gap between announcements and actual implementation. Only 4% of announced capacity reached final investment decisions by mid-2025, suggesting familiar patterns of ambitious targets without corresponding execution capability. Public-private partnerships with international technology leaders show promise but require sustained coordination rather than periodic policy pronouncements. But even perfect execution faces fundamental economic challenges that policy enthusiasm cannot overcome through willpower alone.
India’s renewable advantages mask persistent cost realities
India’s geography provides genuine competitive advantages for green hydrogen production through abundant renewable resources and favorable climate conditions. The country operates over 223 GW of installed renewable capacity, including 108 GW of solar and 51 GW of wind, positioning it among the world’s fastest-growing green energy markets. These resources, combined with falling renewable electricity prices, create potential for globally competitive green hydrogen costs that could transform steel, mobility, and shipping industries.
Researchers Ali O M Maka and Mubbashar Mehmood emphasize that “Hydrogen will become a sustainable and clean energy source by lowering greenhouse gas emissions and reducing reliance on fossil fuels.” Their analysis stresses examining entire supply chains, including storage and transportation, to secure environmental benefits. Studies by JG Segovia-Hernández highlight green hydrogen’s role in energy storage, grid stability, and renewable integration while supporting job creation and industrial innovation aligned with Sustainable Development Goals and COP28 commitments.
However, production costs currently range from $3.5 to $5 per kilogram, while global breakeven thresholds for fossil fuel replacement sit below $2 per kilogram. This cost premium stems from expensive electrolyzers, limited domestic manufacturing, high upfront capital requirements, and significant infrastructure investments.
Analysts from Xynteo, including Vipul Kumar, Varun Desai, and Bhaskar Jha, argue that current subsidies and incentives fall short of bridging the green-grey hydrogen cost gap rapidly. They advocate for long-term purchase agreements, accelerated price discovery, lower renewable power costs, and expanded refinery and fertilizer mandates.
Think tanks like Greenhouse urge caution against viewing hydrogen as a “magic bullet” while neglecting urgent coal phase-out priorities. Additional barriers include the need for competitive green finance, regulatory waivers on power banking, GST reductions on components, and effective carbon pricing frameworks. Proactive policy actions could reduce levelized costs by $1.8 per kilogram, but this requires sustained coordination rather than episodic interventions.
Market opportunities exist but structural challenges persist
Large Indian conglomerates face mounting pressure from decarbonization mandates in global supply chains and the EU’s Carbon Border Adjustment Mechanism, elevating green hydrogen’s strategic importance. The mission’s export focus, coupled with domestic opportunities in steel, chemicals, fertilizers, and transportation, creates a multi-billion-dollar market potential.
Significant progress includes pilot projects across steel, shipping, and mobility sectors, green hydrogen certification schemes, and regulatory simplifications exempting green ammonia plants from environmental clearances. Private sector energy majors and renewable independent power producers pursue gigawatt-scale projects for emerging global export markets.
Yet fundamental execution challenges remain endemic to India’s renewable sector. The gap between project announcements and actual investment decisions reflects persistent issues around policy consistency, regulatory clarity, and the maturity of the financial ecosystem that have historically hampered solar and wind expansion.
Current policy measures, including the Strategic Interventions for Green Hydrogen Transition (SIGHT) program, provide insufficient incentive structures for rapid cost competitiveness. Market-oriented approaches leveraging government support, combined with innovation-driven cost reductions in renewables and electrolysis technology, remain underdeveloped.
Success requires scaling cost-efficient electrolysis capacity, mobilizing patient green finance, and building supply chain resilience through enhanced international technology and funding collaborations. The private sector shows genuine interest, but investment decisions depend on credible policy frameworks rather than aspirational targets.
India’s green hydrogen transition tests collaborative leadership between government, industry, and finance rather than technological readiness alone. The country possesses renewable advantages and market opportunities, but historical patterns suggest that execution capabilities may not match ambitious rhetoric.
Decisive policy actions addressing cost competitiveness, regulatory consistency, and financial ecosystem development could position India prominently in global hydrogen markets while delivering climate and economic benefits for decades.