With a bid to stabilize the unstable energy situation in the country, the Union Government has made a stern assurance that fuel supplies have been stable despite constant rumors of a national LPG cylinder rationing. Nevertheless, there is a huge strategic twist to the message: a vehement drive to make urban and semi-urban families switch Liquefied Petroleum Gas (LPG) to Piped Natural Gas (PNG).
Announced in a high-level inter ministerial briefing this week, this is aimed at responding to the so-called panic booking that has already led to a nearly 40 percent surge in the demand of cylinders in some areas. Although the government still argues that the refineries are running at full capacity, the real message is obvious, the time of the red cylinder as the main urban fuel is starting to sunset.
The Strait of Hormuz Factor: What the Change?
To a significant extent, the existing tension is driven by geopolitical echoes in West Asia. India is also almost totally dependent on imports to supply about 60 percent of its LPG and 90 percent of imports have to traverse a narrow Strait of Hormuz. The LPG chain of supply has been exposed with the recent disruptions in the sea in the region.
A high-ranking official in the Ministry of Petroleum and Natural Gas said that the country was not in a crisis, but rather at a crossroads. By switching to PNG, we are not only opting to use a more convenient fuel, we are also protecting the Indian kitchen against shipping delays around the globe and the vagaries of the high sea winds.
In contrast to LPG, which has a complex logistic network of bottling plants, trucks, and delivery people, PNG goes directly into the homes through an underground system of pipelines. It is this last-mile resiliency that the government is currently gambling on to avoid the supply scares in the future.
Read more: LPG Supply Stable Across India as Government Cracks Down on Hoarding
A Policy that Bites: No More Dual Connections
It is not merely the government that is proposing the move but it is enshrining it. The Amendment Order of the LPG (Regulation of Supply and distribution), 2026 has just been notified, and the households that are already connected to the PNG are now legally prohibited to possess a domestic LPG cylinder.
Over the years, most city households maintained an LPG cylinder to act as a reserve to their piped gas. This practice has now become an illegal activity. The rationale is based on equity: releasing millions of cylinders that are lying idle in flat apartments in cities, the government will be able to allocate the stocks to the rural regions and Ujjwala Yojana beneficiaries with no pipeline access.
Important Directive: The consumers who have dual connections should hand over their LPG cylinders at once. The Oil Marketing Companies (OMCs) have been ordered to cease refills of any household that is known to be having an operational PNG line.
Rewarding the Switch: Carrots to States and Citizens
The Centre has provided an incentive scheme on reform-linked incentives to State Governments in order to accelerate this transition. States have also been given the opportunity to increase 10 percent quota of commercial LPG in the event that they achieve certain milestones in the development of the City Gas Distribution (CGD) system.
These reforms include:
- Rapid Permissions: Authorization of laying out of pipelines within 24 hours in deemed approvals.
- Cost Waivers- Minimizing or issuing road restoration fees on gas companies.
- Infrastructure: Establishing district-level observing committees so that household connections are expedited.
To the final customer, the move is being made sweeter with monetary benefits. Principal suppliers such as Indraprastha Gas Ltd (IGL) and Mahanagar Gas Ltd (MGL) are giving incentives of up to 500 in the form of free gas credits to 31 March new domestic connections started without registration charges.
Also read: Government bans PNG users from refilling LPG connections
Humanizing The Crisis: The Reality on the Ground
In addition to the policy papers, the long queues outside the local distributorships experience the greatest impact of the “shortage” issue. Delivery schedules in cities such as Kolkata and Bengaluru have significantly increased to almost one week as opposed to the normal 48 hours.
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