Govt Hikes Commercial LPG Quota to 70% to Rescue Labour-Intensive Industries
NEW DELHI, March 27, 2026: In a major relief to the industrial sector, the Ministry of Petroleum & Natural Gas (MoPNG) has announced an additional 20% allocation of non-domestic (commercial) LPG, bringing the total supply to 70% of pre-crisis levels.
The decision, communicated by Petroleum Secretary Dr. Neeraj Mittal to all State and Union Territory Chief Secretaries, marks a calibrated effort to jumpstart production in sectors hit by recent supply constraints.
Priority for "Irreplaceable" Processes
The new 20% quota is not a blanket increase but a targeted intervention. The Ministry has directed states to prioritize high-employment and essential sectors, including:
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Steel & Automobiles
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Textiles & Dyeing
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Chemicals & Plastics
Crucially, the government is prioritizing "process industries"—those where LPG is used for specialized heating that cannot be substituted by Natural Gas (PNG). For these specific technical requirements, the government has waived the mandatory requirement to apply for PNG connections.
Pushing for PNG Reforms
While the government is easing the pressure, it remains firm on its long-term transition to cleaner energy. Of the total 70% allocation:
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40% is the base quota.
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10% is incentive-based, granted only to states that implement specific reforms to promote Piped Natural Gas (PNG).
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20% is the new additional allocation announced today.
Dr. Mittal urged states that haven't yet claimed their 10% "reform-based" quota to do so immediately to maximize relief for local industries.
Compliance and Oversight
To avail of the new supply, industries (excluding those with non-substitutable heating needs) must remain registered with Oil Marketing Companies (OMCs) and show proof of application for PNG connections to City Gas Distribution (CGD) entities.
This move is expected to stabilize industrial operations across India while simultaneously enforcing the Natural Gas and Petroleum Products Distribution Order 2026.