India is moving quickly towards cleaner, greener energy solutions. One of the key focus areas
today is green ammonia, which is a clean fuel made from renewable energy sources. With the
right policies and support, green ammonia could help India reduce pollution, cut its dependence
on fossil fuels, and become a global leader in clean energy exports.
In this article, we’ll explain what green ammonia is, why it matters, and how the Indian
government is supporting its growth through policies, incentives, and partnerships.
What Is Green Ammonia?
Green ammonia is produced by combining hydrogen (made using renewable energy like solar
or wind) with nitrogen from the air. This process uses no fossil fuels, unlike the traditional
method, which relies on natural gas or coal. The result is a clean fuel that doesn’t emit harmful
greenhouse gases during production or use.
Green ammonia can be used in:
● Fertilizer production (a major industry in India)
● Shipping fuel
● Energy storage
● Power generation
This makes green ammonia a key player in the global transition to clean energy.
Why India Needs Green Ammonia
India is one of the largest consumers of ammonia in the world, mostly for producing fertilizers.
Traditionally, this ammonia is made using natural gas, which emits a large amount of carbon
dioxide. By switching to green ammonia, India can reduce its emissions and also cut down on
costly imports of gas and fertilizer.
Also, green ammonia offers the country a big opportunity to become a clean energy exporter
in the future, as many countries around the world look to import clean fuels.
Government Initiatives for Green Ammonia
To boost green ammonia in India, the government has rolled out a number of policies and
missions. These aim to support production, create infrastructure, offer financial incentives, and
build a strong domestic market.
Let’s look at some of the major steps the Indian government has taken.
1. Green Hydrogen and Green Ammonia Policy
The Green Hydrogen and Green Ammonia Policy was introduced to support clean fuel
industries. The main focus is to make production easier and more affordable. Key features of
this policy include:
● Free electricity transmission: Companies producing green ammonia can move
renewable power across states without paying transmission charges for 25 years.
● Faster grid access: Priority is given to green ammonia producers to connect to the
electricity grid.
● Power banking: Companies can store extra renewable power and use it later.
● Production zones: Special areas are being developed to support green fuel factories
with land and infrastructure.
● Port support: Major ports are being equipped to handle ammonia export and refueling
for ships.
This policy helps lower costs and makes it attractive for companies to invest in green ammonia.
2. National Green Hydrogen Mission
Under this mission, India aims to become a hub for green hydrogen and green ammonia. The
target is to produce 5 million tonnes of green hydrogen each year by 2030, much of which
can be used to make green ammonia.
The government has set aside a budget of nearly ₹20,000 crore (around USD 2.4 billion) for
this mission. A big part of this money will go to the SIGHT scheme, which provides:
● Support for building electrolysers (the machines that produce green hydrogen)
● Incentives for green ammonia production
● Subsidies for industries that use green ammonia, such as fertilizer plants
The aim is to create a strong domestic industry while also preparing India for exports in the
future.
3. Government Tenders and Support for Industries
To kickstart the market, the government has launched large-scale tenders (bids) for green
ammonia production. The Solar Energy Corporation of India (SECI) has invited bids from private
companies to produce over 700,000 tonnes of green ammonia annually.
The produced ammonia will be used mainly by fertilizer companies, replacing imported
ammonia that’s made using fossil fuels. The government is offering:
● 10-year purchase guarantees to producers
● Fixed payments per kilogram of ammonia
● Support to manage price differences between traditional and green ammonia
This provides confidence to investors and ensures the market is ready to absorb the supply.
4. Viability Gap Funding (VGF)
One of the challenges with green ammonia is that it’s still more expensive to produce than
traditional ammonia. To solve this, the government is working on a Viability Gap Funding
(VGF) scheme.
This means the government will pay part of the cost to make green ammonia affordable and
attractive for both producers and buyers. It is estimated that a fund of about ₹10,000 crore will
be set aside for this purpose in the coming years.
This type of support helps bridge the price gap and encourages faster adoption of green
ammonia across industries.
5. State-Level Policies
Some states in India have started developing their own policies for green hydrogen and green
ammonia.
For example, Andhra Pradesh has announced a state-level green ammonia policy that
includes:
● Tax benefits for green ammonia producers
● Land availability for setting up plants
● Cheaper power access and grid support
● Help in setting up bunkering facilities at ports
These efforts at the state level add to the central government’s push and help build a national
network for clean energy.
Public and Private Sector Participation
Many large Indian and global companies are now entering the green ammonia sector in India.
Several projects are being set up in states like Gujarat, Odisha, and Andhra Pradesh.
Big companies are forming joint ventures, signing export agreements with Europe, and even
planning fuel corridors for green ammonia shipping. This shows that India is preparing not only
to use green ammonia at home but also to become a key exporter in the future.
Export Potential and Global Interest
Green ammonia is seen as a strong candidate for clean fuel exports. It can be stored and
shipped easily, unlike hydrogen gas. Many countries, especially in Europe, are looking to import
green ammonia for their energy needs.
India is building partnerships with foreign ports and companies to set up clean fuel corridors.
Indian ports are being developed with storage and refueling infrastructure, and ships are being
prepared to use green fuels.
The goal is to make India a global hub for exporting clean fuels by the early 2030s.
Challenges Ahead
While progress is strong, there are still challenges to solve:
● High initial costs of setting up plants
● Need for skilled workers and training
● Infrastructure for storage, transport, and shipping
● Global competition from other green ammonia producers
However, the government’s consistent support through policies, funds, and incentives is helping
address these barriers.
Conclusion
Green ammonia is a game-changer for India’s energy, agriculture, and export sectors. The
Indian government is playing a key role by creating forward-looking policies, offering financial
support, and encouraging public-private partnerships.
By supporting green ammonia today, India is investing in a cleaner, safer, and more self-reliant
future. For students, entrepreneurs, and investors, this is a sector full of opportunities and long-
term growth potential.
