The Indian Biogas Association (IBA) has put forward a proposal for the creation of a ₹10,000 crore dedicated fund to support the biogas sector through capital subsidies in the upcoming Union Budget.
In its recommendations, the industry body has also called on the government to enhance existing subsidies for compressed biogas (CBG) projects by 50 per cent, raising the support level to ₹6 crore for every 4.8 tonnes per day (TPD) of capacity. At the same time, IBA has suggested setting a ceiling of ₹25 crore on subsidy support per project. These proposals were outlined in a statement released by the association on Sunday.
According to IBA, the recommendations will be formally submitted to both the Ministry of New and Renewable Energy and the Ministry of Finance. The association added that it has been consistently presenting these demands across multiple platforms ahead of the general Budget.
Beyond financial support, the association has advocated for policy measures to strengthen downstream demand. It has proposed mandating at least a 5 per cent blending of fermented organic manure (FOM) in total fertiliser usage by 2028, with a gradual increase to 10 per cent by 2030.
Looking ahead to the Union Budget 2026, IBA said the biogas and CBG segment should be recognised as a rapidly developing component of India’s green growth strategy. The sector, it noted, now requires stronger fiscal backing, quicker execution of policies, and improved access to finance to attract large-scale private investment and boost rural income generation.
The association has also pressed for an expansion of project-level incentives through higher Central Financial Assistance (CFA). Highlighting rising costs, IBA pointed out that capital expenditure for CBG plants has surged by over 50 per cent since the CFA subsidy scheme was introduced in 2014, driven by multiple cost-related factors.
