Imagine filling up a CNG car a few years from now and knowing that more of the gas has come from farm waste, cattle dung and other organic waste collected in India. That is the kind of change the government’s new GOBARdhan scheme could bring to the fuel sector.
The Union Cabinet has approved the National Circular Bioenergy Scheme, also known as GOBARdhan. The programme will run from FY2027 to FY2036 and has a total outlay of Rs 23,731 crore.
The main aim is to increase the production of compressed biogas or CBG across the country.
What is the government planning?
CBG can be used in vehicles that run on CNG. It can also be supplied through the gas network for other uses.
The scheme will support CBG plants using materials such as:
- Agricultural waste
- Cattle dung
- Sugar industry waste
- Municipal organic waste
- Other forms of biomass
The government wants domestic CBG production to grow nearly ten times. It also wants more private companies and smaller businesses to enter this sector.
| GOBARdhan Scheme | Details |
| Total investment | Rs 23,731 crore |
| Period | FY2027 to FY2036 |
| Fuel | Compressed Biogas |
| Target | Nearly 10 times higher production |
| CBG price support | Rs 2,110 per MMBTU |
| Capital support | Up to Rs 2 crore per TPD |
| CBG blend | 3% initially |
| Higher blend target | 5% by FY2029 |
Why car makers could benefit
The connection with cars is quite simple. CBG can be blended with CNG and used in vehicles designed for CNG.
A large part of the existing CNG network and equipment can also work with CBG. This means the country does not have to create a completely new vehicle fuel system for it.
For the auto industry, this could lead to more interest in CBG compatible vehicles and related infrastructure.
Maruti Suzuki has already shown CBG powered models and has invested in CNG production infrastructure. Other manufacturers could also look at similar projects as CBG availability grows.
More gas stations and pipelines
One major part of the scheme is the development of pipeline connections.
These pipelines can connect CBG plants with trunk pipelines and city gas networks. Better connectivity should make it easier to move the fuel from production plants to the places where it is needed.
The scheme also provides:
- Assured purchase support
- More stable pricing
- Easier access to finance
- Capital assistance for eligible projects
- Support for feedstock collection
- Help for manure processing
This could make it easier for new CBG plants to get investment.
What it could mean for India
The benefits are not limited to cars. Farmers can get another use for agricultural waste and rural businesses can find new income opportunities.
There is also the waste management side. Organic waste that could otherwise be difficult to handle can become a source of fuel and organic manure.
For the auto sector, the biggest change could be a stronger CNG ecosystem with more locally produced gas.
A simple next step for the CNG market
India already has a large CNG vehicle base. The new scheme gives the fuel another source and creates a bigger push for domestic CBG production.
If the planned plants, pipelines and supply systems grow as expected, CBG could become a more familiar part of India’s vehicle fuel mix.
For car companies, that could mean more reason to invest in CNG and CBG technology. For consumers, it could eventually mean a wider and more locally produced supply of gas for their cars.