Gujarat Well Positioned to Become Renewable Hydrogen Hub, But Large Projects Yet to Scale: S&P Global

Gandhinagar, Sep 26 (KNN) Gujarat is emerging as a key hub for renewable hydrogen development in India, supported by its refinery and ammonia capacity, renewable energy resources, ports and state-level incentives, although most large-scale projects remain at the feasibility stage, according to S&P Global.

In its report, ‘Gujarat green hydrogen: Turning an ambition into reality’, S&P Global said the state has several structural advantages for developing renewable hydrogen capacity and is particularly well positioned because of its existing industrial and energy infrastructure, ANI reported.

Around 40 per cent of India’s refinery capacity and 30 per cent of its ammonia capacity are located in Gujarat. The state also has nearly 50 GW of combined solar and wind capacity, while at least 40 per cent of India’s maritime trade enters through Gujarat’s ports.

State Targets 3 MMT Renewable Hydrogen By 2035

Gujarat’s Energy and Petrochemicals Department finalised its hydrogen strategy in December 2025, setting production targets and providing financial support for early projects.

The policy provides incentives for the first 500 MW of electrolyser capacity commissioned in the state, including capital subsidies for eligible electrolyser components, battery storage, oxygen collection and water desalination facilities.

It also supports hydrogen demand through subsidies for refuelling stations, hydrogen-powered buses and heavy-duty vehicles, besides reimbursement for renewable hydrogen used in industrial applications and hydrogen blended into the natural gas network.

Gujarat has set a renewable hydrogen production target of 3 million metric tonnes per year by 2035, the highest among the Indian states compared by S&P Global. However, the report described the target as ‘highly ambitious’.

Large Projects Still At Feasibility Stage

Despite policy support, most large-scale projects in Gujarat remain at an early stage. While Gujarat has the highest number of projects in advanced stages among the states covered, Andhra Pradesh and Odisha have larger capacities in advanced-stage projects.

S&P Global said projects in Gujarat could progress following support under the Centre’s Strategic Interventions for Green Hydrogen Transition (SIGHT) programme.

At the national level, the National Green Hydrogen Mission targets annual renewable hydrogen production of 5 million tonnes by 2030, while the SIGHT programme has an initial allocation of Rs 17,000 crore.

West Coast Location Supports Export Potential

India is also gaining a growing share of international renewable hydrogen trade. Indian developers accounted for 40 per cent of the volume of trade-related renewable hydrogen and derivative offtake agreements signed in 2024 and 2025, rising to 80 per cent for year-to-date 2026 deals, the report noted.

S&P Global said Gujarat’s west-coast location could support exports to European markets, particularly through ammonia. However, competition from the Middle East and China means continued state and central government support will be important for maintaining export competitiveness.

(KNN Bureau)