India's LPG Safety Net: A Strategic Move Amidst Global Turmoil
India's recent decision to set production targets for individual refineries and upstream companies is a strategic move with far-reaching implications. This move, aimed at bolstering domestic supply, comes in the wake of the Middle East chaos disrupting imports, highlighting the country's vulnerability to global supply chain disruptions.
A Complex Web of Dependence
India's heavy reliance on LPG imports is a complex issue. In 2025-26, the country used 33.2 million tonnes of LPG, with imports accounting for a staggering 64% of its requirement. This dependence became a critical issue when the Iran war effectively shut down the Strait of Hormuz, the primary sea route for India's imports from Saudi Arabia and other Middle Eastern countries.
Emergency Measures and Their Impact
The government's emergency measures to boost domestic production had a significant impact. By diverting streams used for petrochemicals towards LPG production and restricting sales to industrial and commercial users, domestic production rose to around 55,000 tonnes a day. However, these measures were temporary, and the new order now focuses on long-term solutions.
The New Order: A Shift Towards Sustainability
The new rules mandate refineries and upstream companies to maintain adequate infrastructure for LPG storage, movement, and transport. This includes implementing technically and economically feasible measures to increase production. The government can also direct companies to increase production levels if needed, ensuring a stable domestic supply.
Reliance's Role: A Strategic Move
Reliance Industries, with its older refinery at Jamnagar, has been given the highest target of 18,000 tonnes of LPG a day. This strategic move not only ensures a stable supply for the domestic market but also positions Reliance as a key player in India's energy security.
Looking Ahead: A Balanced Approach
The government's approach to setting production targets and maintaining infrastructure is a balanced strategy. By reviewing the production schedule every six months, it can adapt to changing circumstances, including the introduction of new refineries and infrastructure upgrades. This ensures a sustainable and secure LPG supply for India, reducing its vulnerability to global disruptions.
In conclusion, India's LPG safety net is a strategic move that addresses a critical vulnerability. By setting production targets, maintaining infrastructure, and adapting to changing circumstances, the country is taking a proactive approach to energy security, ensuring a stable and reliable supply of LPG for its citizens.
