Budget 2026: Green Hydrogen Mission Allocation Unchanged at ₹600 Crore

The Union Budget 2026 on Sunday kept the allocation for the National Green Hydrogen Mission unchanged at ₹600 crore for the financial year 2026-27 compared to budget estimates of 2025-26. The allocation was however higher than the revised estimates of 2025-26 at ₹300 crore. In the previous Union Budget, the National Green Hydrogen Mission had received an allocation of ₹600 crore, with funds directed towards pilot projects, electrolyser manufacturing, demand-side incentives and research and development.

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Green Hydrogen as Critical Decarbonisation Tool

India is aiming to expand its clean energy framework, with green hydrogen emerging as a key link between renewable power and decarbonising hard-to-abate sectors such as refineries, fertilisers, steel and heavy transport. The Budget 2026 allocation is intended to complement existing policy measures aimed at cost reduction and commercial-scale deployment.

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Mission Targets Global Production, Export Leadership

The mission aims to position India as a global hub for green hydrogen production and export. The mission's incentives, including support for electrolyser manufacturing and green ammonia production, will continue, though some transmission waivers have time-bound validity.

The government has set targets for building dedicated renewable energy capacity to supply low-cost power for hydrogen production, and Budgetary support is expected to work alongside schemes such as production-linked incentives (PLI), viability gap funding and targeted infrastructure spending.

Economic Viability Hinges on Renewable Energy Cost Reduction

Green hydrogen's economic case is closely tied to renewable energy growth, as low-cost clean power is the largest determinant of hydrogen production costs. Budget-allocated resources are expected to support closer integration across renewables, manufacturing and industrial demand, as India pursues its broader climate and energy security goals.

The sustained allocation signals continued government commitment to building green hydrogen infrastructure whilst leveraging complementary policy mechanisms to drive commercial adoption and international competitiveness.