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India plans to produce 5 million tonnes of green hydrogen per year by 2030 as it seeks to harness the low costs of renewable energy to become a global exporter of sustainable fuel.

The target was announced by India’s Ministry of Energy on Thursday when unveiling the first part of its national hydrogen policy.

Green hydrogen is produced by separating water with electrolysers powered by renewable energy. It is the most sustainable way to produce hydrogen with almost no emissions.

Saudi Arabia is planning the world’s largest green hydrogen project in Neom, the futuristic city being built on the Kingdom’s Red Sea coast with production expected to start in 2026.

Both Saudi Arabia and India have big plans to produce blue hydrogen, created from fossil fuels with the carbon captured for storage or use.

Last week, Mukesh Ambani, the billionaire chairman of Reliance Industries, said he plans to invest $75 billion in renewable energy infrastructure, including solar panels and electrolysers to produce green hydrogen.

It has been speculated that Ambani will convert all renewable energy production to hydrogen to avoid selling into India’s wholesale electricity market, which is controlled by financially fragile utilities that are notorious for their late payments.

“Reliance is gearing up to capture the entire green hydrogen economy value chain,” Gagan Sidhu, director of the Center for Energy Finance at New Delhi-based think tank CEEW, told Bloomberg. “They clearly saw the writing on the wall.”

Less than a week later, Reliance announced its intention to become one of the world’s largest producers of blue hydrogen. However, rather than natural gas, Reliance will make its blue hydrogen with petroleum coke, an oil refinery byproduct that contains more carbon dioxide than coal.

With so many countries vying for leadership of the clean hydrogen space, it is heating up to become a highly competitive market. India is the 27th country to announce a hydrogen strategy, a figure that doubled in the past year as clean fuel’s potential to drive decarbonization across multiple industries became clearer.

In the Middle East, Abu Dhabi is targeting a 25% market share by 2030, while Oman, Morocco and Egypt are also aggressively pursuing the clean hydrogen market. Outside the region, Russia is aiming for 20% of the hydrogen market by 2030.

Since hydrogen can be produced by any country with an electrolyser and renewable energy resources, it is not yet known how big the market for transporting the fuel between countries will be.

However, the winner is likely to be the country with the lowest renewable energy costs, the scale to produce enough hydrogen at a competitive price, and a strategic location near major consumer markets. On these three measures, Saudi Arabia appears to be a strong contender.


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