LNG import dependency set to decline from 53% to 45% by FY26

Dependence on LNG:  The substantial growth in domestic gas production led to reduced import dependence on LNG. With around 30 million metric standard cubic meters per day (MMSCMD) added over the last three years and another 15 MMSCMD expected to be added by FY25, is reducing India's reliance on imported Liquified Natural Gas. This trend reflects a gradual decline in dependency, from 53 per cent of total consumption in FY21 to an estimated 45 per cent by FY26, a report by CareEdge said on Wednesday. 

“On the back of limited domestic natural gas production, India historically had a high dependence on imported gas. However, during the last three years ended FY23, gas imports had declined mainly due to improved domestic gas production and a rise in imported gas prices,” the CareEdge report said. 

According to the report, India aims to boost its natural gas share in the energy mix to 15 per cent by 2030, a significant increase from the current 6 per cent. This ambition aligns with efforts to transition towards cleaner energy sources. Various sectors like fertilizer, city gas distribution, power, refineries, and petrochemicals are expected to drive this demand surge. 

The stabilisation of imported LNG prices post the disruptions caused by the Russia-Ukraine conflict in FY23 is encouraging. This stability, along with the expansion of LNG export capacities globally, is poised to bolster natural gas demand in India. This supports the nation's goals of energy security and sustainability, marking significant progress towards achieving its ambitious targets.