Centre Issues Order Capping Industrial LPG Supply At 70% Amid Import Constraints
Centre caps industrial LPG supply at 70%, prioritising critical sectors amid import disruptions.
The Ministry of Petroleum and Natural Gas (MoPNG) has announced a cap on industrial Liquefied Petroleum Gas (LPG) supply, limiting allocation to 70% of pre-March 2026 consumption levels, as the government moves to stabilise availability amid disruptions in global import flows.
In an official communication issued by Secretary Neeraj Mittal to all central ministries, state governments, and Union Territory administrations, the ministry stated that industrial users across multiple sectors—including pharmaceuticals, food processing, polymers, agriculture, packaging, paint, steel, metals, ceramics, glass, aerosols, foundries, forging units, heavy water production, uranium processing, and seed manufacturing—will receive LPG supply subject to defined ceilings. The total allocation has been capped at 0.2 thousand metric tonnes per day at the sectoral level.
The order builds on earlier directives issued between March 16 and March 27 and includes an additional 10% allocation linked to compliance with Piped Natural Gas (PNG) reform milestones. The government said the measure is intended to ensure a balanced distribution of LPG while gradually encouraging industries to transition toward alternative and more efficient fuel infrastructure.
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The ministry further clarified that industries where LPG is a critical and non-substitutable input in manufacturing will be given priority in allocation. For such sectors, the requirement to apply for PNG connectivity has been waived to ensure uninterrupted operations, while maintaining regulatory conditions. Officials also distinguished between industries that use LPG as a fuel, which can shift to PNG over time, and those for which LPG is essential to core production processes.
The decision comes amid continued volatility in global energy markets, particularly due to disruptions in West Asia. India, which imports around 60% of its LPG requirements, has been affected by fluctuations in shipping routes, including pressure on supplies passing through the Strait of Hormuz. Recent data indicated a sharp fall in monthly imports, highlighting the need for supply-side management.
Government officials noted that efforts are underway to maintain domestic LPG availability through a combination of measures, including increased absorption of cost pressures by Oil Marketing Companies (OMCs) and enhanced domestic production. States and Union Territories have also been directed to implement related policy measures and accelerate infrastructure reforms aimed at improving long-term energy security and distribution efficiency.
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