In the rolling, wind-swept grasslands of Chifeng in northern China's Inner Mongolia, towering white wind turbines line hilltops like sentinels over a hydrogen industry Beijing is trying to prise away from coal.
They are part of a $2 billion project - the biggest of its kind - that harnesses renewable energy to run banks of electrolysers that produce the molecules needed for fertilizer, marine fuel and low-emission steelmaking.
India shares China's "green hydrogen" ambitions, but its commitments are even more concrete and aggressive. Backed by subsidies worth some $2.1 billion, New Delhi is targeting 5 million metric tons of green hydrogen annually by 2030 - five times the current size of the global market and about double what analysts estimate Chinese output will be by then.
The massive bets by the world's two most populous nations come at the same time that the West has quietly backed away from its ambitious green hydrogen goals from the start of this decade after cost constraints proved stickier than anticipated.
What China and India have in common - despite very different motives - is the power and political will to force a market into existence, by underwriting projects, steering demand and pushing costs down through scale.
India has drawn private capital by pairing subsidies with offtake guarantees from refineries, fertiliser plants and steelmakers, making projects bankable from the outset.
The motivation is energy security. Hydrogen in India is overwhelmingly derived from imported natural gas, whose supply has suffered a sequence of shocks from the Middle East, Ukraine and the pandemic.
For China - able to deploy state-owned giants or attract private firms with large-scale, planning-led industrial projects - the aim is to preserve its dominance in hydrogen as the industry shifts towards cleaner energy.
In its five-year plan announced in March, Beijing listed green hydrogen alongside quantum computing, brain-computer interfaces and AI-enabled robotics as a frontier industry - an elevation in status that signals more capital will flow its way.
CHINA: SPEED AND SCALE
China invested $3.7 billion in green hydrogen production last year, more than double U.S. levels, said Rystad Energy's head of hydrogen, Minh Khoi Le.
By 2031, China will have some 2.6 million tons per year online, representing $26 billion in investment, according to Rystad projections.
Much of 2025's outlay went into the Chifeng project, operated by Chinese wind turbine maker Envision Energy. It aims to sell green hydrogen and ammonia to markets in Asia, Europe, Latin America and the Middle East, and delivered its first green ammonia cargoes to South Korea's Lotte Fine Chemical in February.
"If we go back a year or two ago, China was not very visible on this situation of green hydrogen, and then two years later they have almost all the biggest projects in the world," said the International Energy Agency's hydrogen lead, Jose Bermudez.
China last year likely doubled its renewables-based hydrogen production capacity to 250,000 tons - more than half of the global total, and surpassing a 2022 target to produce 100,000 to 200,000 tons annually by 2025 - said Agora Energy China managing director Kevin Tu.
In Inner Mongolia and other places with high winds and strong sunlight, costs can fall to around $2 per kilogram for green hydrogen, close to parity with coal-based hydrogen, Tu said. On average, producing green hydrogen in China costs around $4 per kilogram, he said.
INDIA: AGGREGATING DOMESTIC DEMAND
India has brought the price of producing green hydrogen as low as 279 rupees (around $3) per kilogram, from around $5 in 2023, when the government launched the National Green Hydrogen Mission under the clean energy ministry.
Abhay Bakre, who heads the mission, told Reuters that the cost should drop to near $2 by 2032 as technology improves, processes become more efficient and more components are made domestically.
Projects will begin delivering "large quantities" of green hydrogen as soon as next year, he said, and "scale up very fast" to hit the target of 5 million tons by 2030.
Under the initiative, industrial heavyweights including Larsen & Toubro, Bharat Petroleum Corp, GAIL and JSW Steel produce about 8,000 tons of green hydrogen and its derivatives annually.
New Delhi is kick-starting demand through state-run reverse auctions, where sellers try to undercut each other to win long-term contracts, effectively revealing the lowest price producers can bear.
The government said last month that suppliers and fertiliser companies had signed offtake agreements for 724,000 tons of green ammonia, which could cover one third of the country's hydrogen requirements.
Maintaining momentum will require "bold, sector-specific domestic initiatives, coupled with strategic international partnerships to unlock export potential", analysts at the Institute of Energy Economics and Financial Analysis wrote in a report.
"With one of the lowest costs of renewable power generation in the world, India is well placed to capture a significant portion of the export market."
Published on April 22, 2026