• Asia could require more than USD 90 billion in hydrogen investments to make it a successful component of decarbonisation strategies
• Countries to have launched national hydrogen strategies include China, India, Japan, Korea, and Singapore
• Foreign investment opportunities include support scaling up green hydrogen manufacturing capacity, mobility, and aviation

As countries across Asia look to reduce greenhouse gas emissions and reach climate targets, hydrogen is increasingly being included in decarbonisation strategies. It can also assist in efforts to reduce fossil fuel imports. For governments to realise these aims, they must build infrastructure and various capabilities. In the third instalment of our series looking at Asia Market Opportunities in 2025, Asian Insiders Managing Partner Jari Hietala offers insights on hydrogen and its growing role across the region. Click here to read the previous articles.

Compared to solar, wind, and other renewable energy investments, the funding going toward hydrogen, particularly green hydrogen, is relatively minor. That has changed in recent years as the costs continue to come down.

Many countries now see the potential of hydrogen. It can be a critical component in reaching climate targets and providing improved energy security. China, India, Japan, Korea, and Singapore are among those to have launched national hydrogen strategies while others are looking to do the same.

This has created a breadth of opportunities across the value chain for foreign investors. According to a report published by the Hydrogen Council, Asia needs to invest approximately USD 90 billion in hydrogen projects by 2030.

The utilisation of hydrogen in Asia is expected to be widespread. Mobility is one area where progress has taken shape. Aviation is another sector where efforts are also ongoing. Looking longer-term, power generation is seen as the next step. Finally, using hydrogen to power steel, petrochemical, and cement production is something many countries are eager to explore with Japan furthest ahead on that front.

Japan remains focused on hydrogen

Japan was among the first to fund hydrogen activities, and the country is now recognised as a global leader. In 2023, the government announced plans to invest nearly USD 108 billion over the next 15 years to increase supplies. The plan places a heavy emphasis on green hydrogen production.

Industry is expected to drive demand in the coming years. Successful pilots subsidized by the New Energy and Industrial Technology Development Organization (NEDO) have shown how hydrogen can be utilised in the iron and steelmaking processes to significantly reduce emissions.

A priority for both the government and companies in the private sector will be developing a robust domestic and international hydrogen supply chain that ensures it is readily available.

South Korea is a hydrogen leader

Korea has been very active since rolling out the Hydrogen Economy Roadmap in 2019. A growing number of hydrogen-powered or fuel cell electric vehicles (FCEVs) are on the road. The government is also formulating growth strategies and finding ways to increase supply and demand.

Several challenges must be addressed in the country, perhaps none quite as significant as the need for green hydrogen. A certification system designed to incentivise the production of clean hydrogen has been implemented. Even as domestic output rises, Korea is and will be heavily reliant on imports. Infrastructure investment continues with the development of port cities capable of receiving and storing ammonia and liquid hydrogen seen as the highest priority.

Key players from Northern America and Europe are currently active in the country, but further overseas investment is necessary to achieve Korea’s hydrogen goals.

India steps up efforts

India has wasted little time in trying to build its hydrogen economy. The government unveiled the National Green Hydrogen Mission in January 2023. This initiative included an initial funding total of USD 2.4 billion, most of which was allocated to the Strategic Interventions for Green Hydrogen Transition (SIGHT) programme. A green hydrogen annual production target of 5 million tonnes has been set for 2030.

The country is actively looking for foreign investment, and several schemes are now in place. For starters, 100 percent foreign direct investment in the hydrogen sector is allowed. Governmental approval requirements have also been waived. Additionally, flexible funding options are available to overseas companies.

There is a desire in India to replace fossil fuels used in the manufacturing of fertiliser, methanol, steel, and chemicals with green hydrogen. That means the country’s hydrogen sector could be among the world’s largest.

China encourages foreign investment in hydrogen

China’s National Development and Reform Commission (NDRC) has placed the hydrogen value chain in the Catalogue for Encouraged Industries for Foreign Investment, highlighting a desire to advance the sector. Even as the world’s largest producer of hydrogen, the country still needs to increase green hydrogen production capabilities as well as improve infrastructure.

The most considerable opportunities for foreign investors in China can be found in clean hydrogen economy development, as well as storage, transportation, and various applications. It should be stressed that entering the market requires strong Chinese partners who share a similar vision and goals.

Central Asia launches green hydrogen production

China, South Korea, and Japan want to scale back brown and grey hydrogen production and ramp up green hydrogen output. The situation is different in Central Asia which is starting from square one. A clean slate has made Kazakhstan and Uzbekistan desirable locations for foreign investment.

The latter signed a strategic partnership on green hydrogen and critical raw materials with the European Union in 2022. Svevind is continuing to work on plans to build a USD 50 billion green hydrogen project in the country. Other European firms are now exploring opportunities.

In Uzbekistan, ACWA Power has broken ground on a large-scale green hydrogen production facility as part of the Saudi Arabian firm’s USD 10 billion investment agreement with the Ministry of Energy. Elsewhere, USAID, in conjunction with the Ministry of Energy and energy sector stakeholders, launched the Green Hydrogen Hub in early 2024.

Asia market opportunities 2025: Hydrogen strategies take shape

Asia is poised for massive growth in hydrogen across the value chain in the coming years. Several governments support the expansion of capabilities and projects through policies and investor-friendly schemes.    

For many countries, scaling up domestic electrolyser manufacturing capacity is critical to ensure an adequate supply of green hydrogen for future use. Opportunities here should be widespread across the region. China, India, Korea, and Japan have each stated a desire to ramp up green hydrogen. Markets such as Thailand, Indonesia, and Central Asia are now following suit.

Other developments taking place in each market are different, meaning requirements vary quite a bit. For example, Korea produces hydrogen-powered passenger vehicles and FCEVs but lacks a charging infrastructure. In contrast, Japan has had some success with its hydrogen highway network of charging stations, although more facilities are still required.

Ultimately, Asia is going all in on hydrogen in an attempt to diversify decarbonisation strategies. The movement has unlocked a wide range of investment opportunities that are not currently available elsewhere in the world.  

To learn more about hydrogen opportunities in Asia and assess your readiness to enter the market, schedule a no-obligation call with Jari Hietala, Managing Partner: jari.Hietala (at)asianinsiders.com