India’s Fuel Crisis: Government Introduces Key Reforms To Boost PNG Connectivity

As the US-Iran conflict shows no signs of ending, causing a scramble for liquefied petroleum gas (LPG) cylinders, the Indian government has issued a directive for consumers to switch to piped natural gas (PNG) wherever connectivity is available. The move aims to expand the PNG network, which is not only more convenient but also domestically produced, reducing India's dependence on imported fuel.

The Ministry of Petroleum and Natural Gas has notified the Natural Gas and Petroleum Products Distribution (Through Laying, Building, Operation and Expansion of Pipelines and Other Facilities) Order, 2026.

This order is designed to accelerate pipeline infrastructure, streamline approvals, and encourage households to transition from LPG to PNG, thereby strengthening the country's energy security. It also stipulates that LPG supply "shall cease after three months" for households that do not opt for PNG, where available. Exceptions are allowed only in cases where a piped connection is "technically infeasible," subject to a no-objection certificate.

The Petroleum and Natural Gas Regulatory Board (PNGRB) has been designated as the nodal agency to monitor the implementation of this order, including tracking approvals, rejections, and overall compliance.

Key Reforms To Boost The PNG Network

1. Incentives for Consumers

Gas distribution companies are offering various incentives to encourage both domestic and commercial LPG users to switch to PNG. Despite the benefits of PNG, many households still prefer LPG for its portability, making these incentives a crucial driver of adoption.

2. Reducing Red Tape

Issued under the Essential Commodities Act, the new order seeks to fast-track pipeline development by easing approvals, standardising charges, and enforcing time-bound permissions. Public authorities must grant the right of way or approvals within prescribed timelines; otherwise, approvals will be automatically deemed granted. The order also prevents authorities from imposing charges beyond the specified limits.

3. Simplifying Housing Area Connectivity

Housing societies and local bodies are required to provide permissions within three working days, while last-mile PNG connectivity must be completed within 48 hours. Applications for pipeline connections in such areas cannot be rejected. The order protects gas companies from obstruction but also obliges them to act promptly once permissions are granted.

4. Curbing Unofficial Charges

Public entities are barred from levying any extra fees, wayleave charges, surcharges, development fees, annuities, or compensation beyond the standardised amounts outlined in the order. This aims to eliminate the practice of municipalities imposing unofficial charges that previously slowed pipeline projects.

5. Accountability for Gas Companies

Gas companies that obtain permissions but fail to lay pipelines within four months will be considered in default of their licence obligations. Penalties may include fines and potential removal of their area exclusivity.

With these reforms, the government hopes to significantly expand PNG connectivity, promote energy self-reliance, and reduce India's dependence on imported LPG.