Beyond the membrane: How India's green hydrogen ecosystem is maturing

India's green hydrogen sector has made significant progress, with commissioned plants, operational full-scale factories, and competitive price discovery mechanisms that bring new projects within sight of final investment decisions.

In our previous post on this subject, we sought to draw your attention towards the innovative membrane-less electrolyser technologies being developed and commercialised by Newtrace, one of our own portfolio ventures. In this post, we offer our views on how deep tech companies such as Newtrace are building the right product at the right time in the right market – the maturing green hydrogen landscape in India.

The domestic electrolyser manufacturing capacity planned for development currently is approximately 15,000 MW across 15 selected companies, requiring investments of Rs. 30,000-45,000 crore. Some facilities have commenced operations and are expected to ramp up — Ohmium's gigafactory is a noteworthy example.

We are seeing the emergence of a complete value chain anchored in growing domestic innovation. Companies such as Newtrace, which pioneered membrane-free electrolysis technology, now operate alongside established manufacturers such as L&T Electrolysers, Advait Infratech, and Waaree Energies.

This constellation of capabilities — from fundamental research breakthroughs to gigawatt-scale manufacturing — creates the ecosystem density necessary for sustained competitiveness.

The government's Strategic Interventions for Green Hydrogen Transition (SIGHT) programme has proven effective at catalysing market formation. Through transparent tendering processes, SECI has awarded contracts for 412,000 tonnes of annual green hydrogen production capacity, with another 450,000 tonnes currently under procurement.

More significantly, a global tender for 700,000 tonnes of green ammonia, the world's largest, signals confidence in India's ability to operate at frontier scale. These are not pilot projects but commercial undertakings that require proven technology and reliable supply chains.

State-level policy architecture has evolved in parallel, embedding approximately Rs. 5 lakh crore in incentives across various jurisdictions. This represents twenty-six times the National Green Hydrogen Mission's budget, demonstrating how initial federal frameworks have catalysed broader institutional commitment.

As production scales and learning curves steepen, green hydrogen and ammonia prices are converging with conventional fuels. This price discovery, occurring through competitive bidding rather than administrative fiat, establishes market-clearing mechanisms that enable forward-thinking investment decisions.

Initially, rather than create new applications with uncertain demand, companies are targeting existing consumption in refineries and steel plants — sectors that already use 6-7 million tonnes annually but produce it from fossil fuels — reducing market risk.

SIGHT programme allocations include 200,000 tonnes specifically for refineries, addressing the transportation challenges inherent in hydrogen's physical properties while ensuring predictable off-take.

International partnerships, such as the one with Netherlands, and the broader EU-India Trade and Technology Council, also reflect India’s position as a natural and significant member of the global supply chain in this sector. India is also establishing carbon emission accounting frameworks, standardising reporting. This helps India's hydrogen exporters get verifiable credentials in markets such as the EU for example.

India aims to capture approximately 10 percent of the projected global market for green hydrogen, equivalent to 10 million metric tonnes per annum by 2030. Port infrastructure at Kandla, coupled with green hydrogen hubs incorporating shared facilities, positions the country to serve international markets whilst maintaining domestic supply chains.

‘Guidelines for Green Hydrogen Hubs and Hydrogen Valley Innovation Centres,’ released through the Ministry of New and Renewable Energy, establish frameworks for regional specialisation and knowledge clustering. These hubs target 100,000 metric tonnes per annum production capacity each, creating centres of excellence mapped under the PM Gati Shakti portal for coordinated infrastructure development.

While electrolysis-based hydrogen production dominates current activity, the government is offering Rs. 100 crore in funding for biomass-to-hydrogen programmes via the Biotechnology Industry Research Assistance Council. This reflects support for innovation aimed at alternatives. The government is also offering hundreds of crores of rupees in funding support for hydrogen tech startups in storage, transportation and utilisation.

India has already attracted thousands of crores in private investments in green hydrogen projects. And the government projects an anticipated Rs. 800,000 crore total investment by 2030 — factoring in the participation of domestic conglomerates as well as international companies.

For deep-tech startups such as Newtrace, and those developing advanced materials, novel electrolyser architectures, storage solutions, and integration technologies, the path from research grants to commercial customers is opening up.