Like other countries India is also facing the grave problems- energy crisis, environmental problem. As far as Indian Renewable energy potential is concern, Biomass energy is highly promising alternative in this regard. Biomass energy is widely famous for electricity, heat generation or combined heat and power applications (CHPs). Biomass gasification which is one of the most efficient thermochemical conversion technique, which produces syn gas, one of the suitable feedstock for heat, power and chemicals. Mostly, agricultural wastes are used in India for biomass power. Gasifier-based power plants are providing a great solution for off-grid decentralized power and are lighting homes in several Indian states. While for providing grid-based power 8-15 MW thermal biomass power plants are suitable for Indian conditions, they stand nowhere when compared to power plants being set up in Europe which are at least 20 times larger. Government policy is the biggest factor behind lack of investment in bio power sector in states with high biomass potential. There are many challenges to expanding biomass energy such as collecting, storing and transporting the agricultural waste to power plants. The present paper focuses on Indian policies and major constraints. This paper also presents the advances in gasification technology in India and further need of research in this area.