Cabinet Approves ₹23,731 Crore GOBARdhan Bioenergy Scheme

The GOBARdhan scheme is expected to increase domestic compressed biogas production by nearly ten times over the coming decade.

The Union Cabinet has approved the GOBARdhan (Galvanising Organic Bio-Agro Resources Dhan) National Circular Bioenergy Scheme, a ₹23,731 crore initiative that seeks to transform agricultural and organic waste into clean energy, organic manure and new income opportunities for rural India. The scheme, approved under the chairmanship of Prime Minister Narendra Modi, will be implemented from 2026-27 to 2035-36 and is expected to make compressed biogas (CBG) a major part of India's future energy mix.

The Government said the programme will create a nationwide framework that supports the production of clean fuel from agricultural residue, cattle dung, municipal organic waste, press mud and other biomass resources while encouraging private investment and strengthening the country's energy security.

National Push for Compressed Biogas Production

The GOBARdhan scheme is expected to increase domestic compressed biogas production by nearly ten times over the coming decade. Officials said the initiative combines assured market demand, stable pricing, capital support, pipeline infrastructure, credit assistance and technology development to make CBG projects financially viable and attractive for investors.

The Government believes the programme will reduce dependence on imported fossil fuels by expanding the use of renewable gas across transport, households, industries and commercial sectors. Since compressed biogas is chemically similar to natural gas, it can be supplied through the country's existing gas distribution network without major infrastructure changes.

Six Measures to Drive Industry Growth

The scheme has been built around six major components to support the entire CBG value chain. These include guaranteed offtake through City Gas Distribution networks, a government-backed administered price of ₹2,110 per MMBTU, capital assistance of up to ₹2 crore per tonne per day of installed capacity for eligible projects, support for pipeline connectivity, a dedicated credit guarantee mechanism for MSMEs and a new CBG Ecosystem Challenge Fund.

The Challenge Fund will support district-level planning, feedstock mapping, technology adoption, infrastructure development, capacity building and awareness programmes. The Government expects these measures to reduce financial risks, improve access to credit and encourage greater participation from private developers, cooperatives, women entrepreneurs and rural enterprises.

Building on Existing Bioenergy Progress

The Ministry of Petroleum and Natural Gas will administer the scheme, bringing together several existing initiatives under a single national framework. Over the past few years, programmes such as SATAT, the Market Development Assistance Scheme, the Biomass Aggregation Machinery Scheme, the Development of Pipeline Infrastructure Scheme and financial assistance under the National Bioenergy Programme have already helped commission more than 200 compressed biogas plants across the country.

According to the Government, integrating these efforts under GOBARdhan will simplify project implementation, improve investor confidence and create stronger links across the production, transportation and utilisation of compressed biogas.

Rural Economy and Energy Security to Benefit

The Government expects the scheme to create fresh income opportunities for farmers by generating demand for agricultural residue and cattle dung while supporting scientific waste management across rural and urban areas. Every CBG plant is expected to create local employment in feedstock collection, transportation, plant operations and organic manure production, strengthening village economies alongside clean energy generation.

Officials also said the initiative will help lower greenhouse gas emissions by converting organic waste into renewable fuel instead of allowing it to decompose or be burned. With greater domestic production of clean energy, India is expected to strengthen its energy security while supporting its broader goals of waste-to-wealth, Atmanirbhar Bharat and Viksit Bharat.