India Launches Incentive Scheme to Boost Piped Gas Connections Amid LPG Supply Crisis
In response to rising liquefied petroleum gas (LPG) costs caused by the Iran war disrupting supply from the Middle East, India has introduced an incentive scheme aimed at expanding piped natural gas (PNG) connections. The initiative, effective September 1, 2026, encourages city gas distributors to convert unbilled PNG connections into active ones and expand access in new areas. Approximately 60% of Indian households rely on LPG for cooking fuel, with most imports previously passing through the Strait of Hormuz. The conflict has significantly increased import costs as India is now sourcing from alternative suppliers at higher prices. To mitigate this impact, eligible city gas distributors will receive an additional allocation of domestically produced natural gas per new PNG connection. The government expects that substituting costlier liquefied natural gas (LNG) with the allocated domestic supply in transport segments will reduce overall costs for CGD companies and help stabilize household fuel expenses.
