India Sets Ambitious Target for Green Hydrogen Production, Aims for Fivefold Global Market Share

India and China Emerge as Global Leaders in Green Hydrogen Production

India is setting its sights on producing 5 million metric tonnes of green hydrogen annually by 2030, a target that is five times the current size of the global market and roughly double analyst estimates for Chinese output by that year. The ambitious goal is backed by government subsidies of approximately $2.1 billion, according to a report by Reuters.

India's National Green Hydrogen Mission, launched in 2023 with a total outlay of ₹19,744 crore, has made significant strides in driving down production costs. The mission has used competitive reverse auctions to bring the cost down from approximately $5 per kilogram at inception to around $3 today. Mission head Abhay Bakre estimates that the cost should reach $2 per kilogram by 2032.

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China, on the other hand, has made significant investments in the sector, with $3.7 billion invested last year alone, more than double US levels, according to Rystad Energy. China's $2 billion Chifeng project in Inner Mongolia, the world's largest, is already exporting green ammonia to South Korea and is expected to have 2.6 million tonnes per year online by 2031.

Both India and China have successfully addressed the demand-supply coordination problem that stalled Western ambitions. India has paired production subsidies with guaranteed government offtake from state-run refineries and fertiliser plants, while China has used state-led industrial planning to drive the sector forward.

The success of India's National Green Hydrogen Mission has also benefited listed Indian companies, including L&T, BPCL, GAIL, and JSW Steel. Each of these companies has a distinct role in the value chain and materially different near-term versus long-term exposure.

L&T is an engineering enabler, building electrolyser plants and hydrogen infrastructure, while BPCL has captive demand from day one, with its refineries serving as offtake customers under the government's auction programme. GAIL's 22,000-km gas pipeline network provides a structural moat, making it the infrastructure backbone of any scaled-up ecosystem. JSW Steel, through JSW Energy, is the first Indian company supplying green hydrogen for commercial steel production, with a 3,800 tonne-per-year project underway.

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For all four companies, green hydrogen remains a small fraction of current revenues. Motilal Oswal, in a March 2026 note, recommended a 5-plus year investment horizon for the sector, with most projects still at pilot or early-commissioning stage. The policy framework is the strongest it has been, but the distance between 8,000 tonnes commissioned today and 5 million tonnes targeted by 2030 remains the central execution risk.