India aims to add 125 gigawatts of additional renewable energy capacity to achieve its green hydrogen targets. The Ministry of New and Renewable Energy (MNRE), a crucial player in the country's decarbonisation efforts, has suggested exemptions for green hydrogen developers. These exemptions include allowing them to import solar PV modules and wind turbine models from China without adhering to the list of authorized manufacturers. The MNRE also proposed duty and tax exemptions on equipment imports for export-oriented green hydrogen projects until 2035.

During a meeting with green hydrogen developers, MNRE discussed the possibility of exempting developers from the Approved List of Models and Manufacturers (ALMM) and Revised List of Models and Manufacturers (RLLM), enabling the import of Chinese equipment. This move aims to make India's green hydrogen exports more competitive globally. The ALMM adherence requirement has been temporarily suspended for the current fiscal year to boost solar capacity.

The proposed exemptions would facilitate competitive pricing for green hydrogen equipment imports, benefiting companies and central public sector undertakings like Indian Oil Corporation Ltd and NTPC Ltd. These exemptions, coupled with the proposed relief from duties and taxes on equipment imports for export-oriented projects, could give Indian developers an advantage over global competitors.

RK Singh, Union Minister for New and Renewable Energy, expressed the government's commitment to ensuring India's competitiveness in green hydrogen production and meeting National Green Hydrogen Mission targets.

Despite the push for self-sufficiency and reduced dependence on Chinese imports, the proposed exemptions recognize the cost-effectiveness of Chinese solar PV modules and electrolysers. To achieve its 2030 green hydrogen targets, India needs an additional 125 gigawatts of renewable energy capacity. Importing equipment from China, a global hub for electrolyser manufacturing, could be crucial to meeting these goals.

The MNRE's Production Linked Incentive (PLI) scheme under the Strategic Interventions for Green Hydrogen (SIGHT) program, with a budget of Rs 4,400 crore, aims to boost domestic electrolyser manufacturing. However, achieving self-sufficiency in this sector may take years. In the meantime, allowing imports of Chinese electrolysers could support the green hydrogen ambitions of central public sector undertakings like Indian Oil and NTPC.

The Finance Ministry's order, restricting the procurement of finished goods from countries sharing a land border with India, poses challenges to importing equipment from China. While central PSUs face restrictions, other entities have continued importing electrolysers, with China being a significant source. The government's efforts to curb Chinese imports stem from security concerns and the desire to promote domestic manufacturing, especially following the 2020 Galwan Valley skirmishes.