The Ministry of Petroleum & Natural Gas (MoPNG) has issued an order to ensure continued and
stable availability of Liquefied petroleum gas (LPG) for industrial consumption amid evolving supply
conditions.
In a letter to all Secretaries to the Government of India and All State and UT Chief Secretaries, Dr.
Neeraj Mittal, Secretary, MoPNG, said that industrial units in pharma, food processing, polymer,
agriculture, packaging, paint, steel, metal, ceramic, glass, aerosol, foundry, forging, heavy water,
uranium, and seed sectors will receive 70% of their pre-March 2026 Bulk LPG consumption, subject
to an overall sectoral ceiling of 0.2 TMT per day. This builds on communications between March 16
and 27 with an additional 10% tied to Piped Natural Gas (PNG) reform milestones. The approach
ensures calibrated distribution of LPG while promoting a gradual transition towards alternative fuel
infrastructure.
The MoPNG has further said that industries where LPG serves as a critical and non-substitutable
input in the manufacturing process will be accorded inter-se priority in allocation. For such sectors,
the requirement to apply for PNG connectivity has been waived, ensuring that industrial operations
remain unaffected while maintaining compliance with stipulated conditions.
The Ministry has also drawn a clear distinction between industries that use LPG as a fuel, which can
transition to PNG over time, and those for which LPG is an irreplaceable manufacturing input.
Prime Minister Narendra Modi, and Union Petroleum and Natural Gas Minister Hardeep Singh Puri
have both emphasized the need for stable domestic LPG despite the significant volatility in global
prices due to the conflict in West Asia. To this extent, the government has chosen to absorb the
rising prices by absorbing costs through Oil Marketing Companies (OMCs), and rising domestic
production, and not pass the full cost burden to the consumer.
States and Union Territories have also been advised to disseminate the provisions of the Natural Gas
and Petroleum Products Distribution (Pipelines and Other Facilities) Order, 2026 to all relevant
stakeholders, promptly utilise the additional reform-linked LPG allocation, and expedite notification
of the CBG policy communicated earlier, in line with the Government’s broader efforts to strengthen
energy accessibility and infrastructure.
India imports 60% of its LPG and about 90% of that normally transits Hormuz. When the route came
under stress, monthly imports fell from 2.04 million tonnes in February to 1.12 million tonnes in
March, a 45% collapse in 30 days.
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