Natural Gas India: Fueling Growth in 2025

India’s energy landscape is undergoing a transformative shift, with natural gas emerging as a cornerstone of sustainable development. As the country pursues energy security and climate goals, natural gas is playing an increasingly vital role in powering industry, transport, and households.

The Rising Importance of Natural Gas in India

Natural gas accounts for over 7% of India’s total energy consumption, with steady growth driven by rising industrial demand, rising urbanization, and supportive government policies. In 2024, India imported nearly 200 million tonnes of natural gas, underscoring its dependence on imports—but domestic production and new LNG infrastructure are helping reduce reliance.

The government’s National Energy Policy 2024 emphasizes natural gas as a bridge fuel, aiming to increase its share from 7% to 12% of total energy by 2030. This push aligns with India’s commitment to cut emissions and improve air quality in densely populated regions.

Key Sectors Driving Demand

Industrial Applications

The manufacturing sector is the largest consumer, using natural gas for steam generation, process heating, and boilers. Industries such as fertilizers, chemicals, and steel are increasingly switching from coal and oil to gas due to lower emissions and operational efficiency. Recent investments in gas-based combined heat and power (CHP) systems have reduced energy costs and improved productivity.

Power Generation

Natural gas-fired power plants are gaining traction as a flexible, low-carbon alternative to coal. With India’s renewable capacity expanding, gas plants serve as reliable backup during intermittent solar and wind output. The government’s expansion of gas infrastructure—including 100+ new pipeline connections and LNG terminals—supports this growth, enabling cleaner baseload power.

Residential and Commercial Use

In urban centers, natural gas is replacing LPG and coal in cooking and heating, offering cleaner indoor air and reduced health risks. Governments at the state level are promoting gas connections under programs like PM Ujjwala Yojana Phase II and state-specific subsidies, encouraging millions of households to switch safely and sustainably.

Infrastructure and Policy Advances

India’s natural gas ecosystem is expanding rapidly. The government has approved over $25 billion in investments for new LNG terminals, pipeline networks, and exploration blocks across Assam, Gujarat, and Andhra Pradesh. The Petroleum Ministry’s 2025 roadmap prioritizes domestic production growth, aiming to boost output from 8 million tonnes per annum (mtpa) to 15 mtpa by 2027 through enhanced drilling technologies and private sector participation.

Regulatory reforms—including simplified permit processes and transparent pricing mechanisms—have boosted investor confidence. International partnerships, particularly with Qatar, Australia, and the U.S., secure long-term supply and technology collaboration.

Challenges and Future Outlook

Despite progress, natural gas adoption faces hurdles: high import costs, limited pipeline coverage in rural areas, and public awareness gaps. However, ongoing policy interventions, falling global gas prices post-2024, and growing climate consciousness are accelerating acceptance.

Looking ahead, natural gas is poised to grow from 7% to over 10% of India’s energy mix by 2030. Its role in decarbonizing heavy industry, powering clean energy grids, and improving energy access in underserved regions positions it as a critical pillar of India’s sustainable future.

Conclusion

Natural gas is no longer a niche energy source in India—it’s a strategic asset driving economic growth and environmental progress. With strong government support, expanding infrastructure, and rising domestic production, the energy transition is accelerating. Readers are encouraged to support local gas adoption, advocate for cleaner energy policies, and explore efficient gas-based solutions in their homes and businesses to contribute to a greener, more resilient India.