'Coal gasification business to get VGF scheme in 3 months'

Proposal for 6,000-crore VGF support has been approved by the expenditure finance panel

- Rituraj Baruah & Subhash Narayan

The Centre is likely to roll out the much-anticipated viability gap funding (VGF) scheme for coal gasification in the next two to three months, said the union minister for parliamentary affairs, coal and mines Pralhad Joshi.

In an interview, the minister said the proposal for VGF support worth 16,000 crore has been approved by the expenditure finance committee (EFC).

"In principle, finance ministry has allocated around 6,000 crore. The plan for executing the scheme has been finalized. The expenditure finance committee has also approved the proposal," he said.

"This scheme may come up in another two to three months," he said, adding that the proposal would have to be sent for cabinet approval.

Noting that coal gasification has so far been successful in countries where coal has low ash content, Joshi said given that the ash content in the domestic coal is high, the government aims to make gasification viable and "create a success story" with fiscal support.

India has been making efforts to gasify coal with high ash content and this scheme will give the opportunity to promote in large scale commercial government gasification projects.