The Indian government has set an emission limit of two kilogram carbon-dioxide for every kilogram of hydrogen produced to be classified as "green" from renewable sources, the Ministry of New and Renewable Energy said on Saturday.

It said in a statement its notification would bring widely-awaited clarity for green hydrogen production in India.

"With this notification, India becomes one of the first few countries in the world to announce a definition of Green Hydrogen," the ministry said in the statement, which detailed what emissions would be accounted for.

India wants to become a global hub for the production of green hydrogen and is aiming for annual production of 5 million metric tons of the fuel by 2030, which would cut about 50 million metric tons of carbon emissions and save more than $12 billion on fossil fuel imports.

It is an ambitious plan for a country whose hydrogen consumed currently is produced mostly with fossil fuels.

While hydrogen fuel only emits water when used as fuel, it is made by electrolysis plants that split water molecules and at issue is what energy is used to produce it and carbon emissions involved in the process.

Earlier this year, officials told Reuters India, which holds the rotating Group of 20 presidency this year, was suggesting a 1 kg CO2 emissions limit for green hydrogen, half of the threshold announced on Saturday.

Although first production is expected only in 2026, India has been negotiating bilateral agreements with the European Union, Japan and other countries to start exporting the fuel.

(Reporting by Swati Bhat; Editing by Tomasz Janowski)