Officials said the move is aimed at reducing India’s dependence on imported natural gas and improving self-reliance in fertiliser production. | Photo Credit: DAVID MERCADO

The government is in the process of finalising a new policy for coal gasification-based urea manufacturing and will be ready within a month, an official said, highlighting that the move will boost self-reliance and save foreign exchange, given the country's heavy dependence on imported natural gas, an official said.

Speaking during a roadshow here to promote the government's coal gasification scheme, an official said, "We are in the process of making our new policy for coal gasification-based urea manufacturing and are reaching towards that and within one month we will be ready for that." "Since it is assured government business and we are highly dependent upon natural gases and as 25 per cent is imported from various countries that will be more beneficial for us in terms of self-reliance and foreign exchequer," he said.

Coal Secretary Vikram Dev Dutt said the Ministry of Chemicals and Fertilisers has been working on the new urea policy for sometime, which has now been triggered with the sense of urgency due to the current situation, and the "inputs were given from the Ministry of Coal that coal gasification to urea should also be included in the new urea policy, which is at a very advanced stage and should be through in a month." Coal gasification-based urea manufacturing converts raw coal and pet coke into syngas (hydrogen and carbon monoxide) via high temperature oxidation. This hydrogen is combined with nitrogen from the air to synthesise ammonia, which is then reacted with carbon dioxide to produce urea. It replaces natural gas as a feedstock, reducing import dependence.

A domestic coal-gasification firm had earlier written to the government, seeking that coal-based urea projects be placed on equal footing with gas-based plants, including the introduction of appropriate offtake assurance mechanisms and earmarking of capacities for the coal-gasification route.

The representation came amid a broader government push to diversify feedstock sources for urea production, reduce reliance on imported natural gas, and leverage India's vast domestic coal reserves through cleaner gasification technologies.

In a letter to the government, New Era Cleantech Solution, a Maharashtra-based company developing a 5 MMTPA coal gasification project in Chandrapur, said coal-based urea projects should be given parity with gas-based plants, including suitable offtake assurance mechanisms and the earmarking of capacities for the coal-gasification route.

New Era Cleantech Solution Pvt Ltd plans to set up a 1.27 MMTPA coal gasification-based urea project at Bhadravati in Chandrapur district of Maharashtra.

Published on May 28, 2026