India LPG Market is expected to grow at a CAGR of 4.1% through 2029
The India LPG market is
rising due to increasing urbanization, government initiatives promoting cleaner
cooking fuels, and growing consumer awareness of health and environmental
benefits associated with using liquefied petroleum gas over traditional biomass
and coal in the forecast period 2026-2030F.
According to TechSci Research report, “India LPG Market - By Region, Competition, Forecast and Opportunities 2020-2030F”, India LPG Market was valued at USD 17.4 billion in 2024 and is expected to reach at USD 22.34 Million in 2030 and project robust growth in the forecast period with a CAGR of 4.1% through 2030.
The increasing demand
for LPG in the industrial and commercial sectors is another key driver of the
India LPG market. As industries seek cleaner and more efficient energy sources
to meet operational requirements, LPG has emerged as a favored alternative due to
its versatility and effectiveness. Sectors such as manufacturing, hospitality,
and food processing are increasingly adopting LPG for heating, cooking, and
other energy-intensive processes. The push for sustainability and adherence to
stricter environmental regulations compel businesses to transition from
traditional fossil fuels to cleaner alternatives like LPG, which helps reduce
their carbon footprint. Moreover, the ease of transportation and storage of LPG
makes it an attractive option for businesses that require reliable energy
supply without significant infrastructural investment. This trend is
particularly pronounced in urban areas, where industrial activities are
concentrated. As companies continue to prioritize energy efficiency and
sustainability in their operations, the demand for LPG in these sectors is
expected to grow, contributing significantly to the overall market expansion.
The industrial and commercial adoption of LPG not only enhances operational
efficiencies but also supports India's broader energy transition goals.
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The North region of India has emerged as
the fastest-growing area in the LPG market, driven by a combination of
government initiatives, increasing urbanization, and a rising awareness of the
health benefits associated with cleaner cooking fuels. One of the primary
catalysts for this growth has been the Indian government's focus on improving
access to LPG through programs like the Pradhan Mantri Ujjwala Yojana, which
aims to provide subsidized LPG connections to low-income households. This
initiative has significantly enhanced the penetration of LPG in rural and
semi-urban areas, where traditional cooking fuels, such as firewood and
kerosene, have long been prevalent. As more households gain access to LPG, the
region is witnessing a surge in demand, particularly among women, who are
increasingly advocating for cleaner, safer cooking options for their families.
Moreover, the North region encompasses densely populated urban centers such as
Delhi, Chandigarh, and Haryana, where rapid urbanization has led to a greater
reliance on modern energy solutions. The expanding urban middle class is
seeking convenience and efficiency in their cooking practices, further driving
LPG consumption. Additionally, the industrial sector in the North is also
growing, with increased adoption of LPG for applications in manufacturing, food
processing, and hospitality. The versatility and efficiency of LPG make it an
attractive energy source for these industries, contributing to the overall
demand in the region.
Infrastructure improvements have also
played a critical role in bolstering the LPG supply chain in North India. The
establishment of new bottling plants and distribution terminals has enhanced
logistics and reduced the time taken to deliver LPG cylinders to consumers.
These advancements ensure a more reliable supply, which is crucial for
maintaining customer satisfaction and encouraging further adoption.
Additionally, local partnerships with distributors and retailers are being
strengthened to optimize last-mile delivery, ensuring that LPG reaches even the
most remote areas efficiently. The increasing awareness of the adverse health
effects linked to indoor air pollution has further accelerated the shift toward
LPG. Families are becoming more conscious of the benefits of using LPG over
traditional fuels, which produce harmful emissions. This growing health
consciousness is not only fostering demand in households but is also prompting
educational campaigns by both governmental and non-governmental organizations,
promoting LPG as a safer alternative.
Based on Source, the India LPG market
was predominantly driven by the crude oil distillation segment, which is
expected to maintain its dominance throughout the forecast period. This segment
benefits significantly from the country's robust refining capacity, where major
refineries convert crude oil into various petroleum products, including LPG.
With India being one of the largest importers of crude oil, the distillation
process plays a crucial role in meeting the rising domestic demand for
liquefied petroleum gas. The efficiency of refineries in processing crude oil
into LPG ensures a steady supply, making it the most significant source in the
Indian market. Additionally, the government's ongoing initiatives to enhance
refining capabilities and improve infrastructure further bolster the reliance
on crude oil distillation. While other sources, such as natural gas liquids
(NGL) and liquefied natural gas (LNG) fractionation, contribute to the LPG
supply, they are comparatively limited in volume and capacity. NGL and LNG
fractionation processes offer alternative pathways for LPG production, but the
infrastructure required for these processes is still developing in India.
Furthermore, imports of LPG have been rising, but they often fluctuate based on
global market conditions and pricing, making them less reliable than domestic
production from crude oil distillation. As the demand for LPG continues to
grow, particularly due to government programs promoting cleaner cooking fuels,
the focus on enhancing crude oil distillation capabilities will remain
paramount. Consequently, investments in refining technologies and processes
will likely reinforce the dominance of this segment in the LPG market. Overall,
as India seeks to balance energy security with sustainability goals, crude oil
distillation will continue to be the backbone of the LPG supply chain, ensuring
its leading position in the market for the foreseeable future.
Key market players in the India LPG
Market are: -
- Indian
Oil Corporation Limited
- Bharat
Petroleum Corporation Limited
- Hindustan
Petroleum Corporation Limited
- Reliance
Industries Limited
- GAIL
(India) Limited
- Mangalore
Refinery and Petrochemicals Limited
- Oil
and Natural Gas Corporation Limited
- Essar
Oil Limited
- Gujarat
Gas Limited
- Indraprastha
Gas Limited
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“The India LPG market presents several
promising opportunities for growth and innovation. Expanding rural
electrification initiatives and government programs aimed at increasing LPG
access can drive significant demand, particularly in underserved areas.
Additionally, the rising emphasis on cleaner cooking fuels due to health and
environmental concerns creates a strong market for LPG as a sustainable
alternative. Technological advancements in smart LPG solutions, such as
IoT-enabled monitoring systems, offer new avenues for enhancing consumer
experience and operational efficiency. Furthermore, the growing industrial
sector's shift towards cleaner energy sources presents substantial
opportunities for LPG adoption in manufacturing and processing applications.
Finally, strategic partnerships with renewable energy companies to produce
bio-LPG can diversify product offerings and align with sustainability goals.
Collectively, these factors position the LPG market as a vital component of
India's energy transition strategy, fostering long-term growth and investment
potential”, said Mr. Karan Chechi, Research Director of TechSci Research, a
research-based Global management consulting firm.
“India LPG Market By Source (Crude Oil Distillation, NGL & LNG Fractionation,
Imports), By Application (Residential, Commercial, Industrial, Transportation,
Others), By Supply Mode (Packaged, Bulk, On-site), By Region, Competition, Forecast and Opportunities 2020-2030F”,
has evaluated the future growth potential of India LPG Market and
provides statistics & information on market size, structure, and future
market growth. The report intends to provide cutting-edge market intelligence
and help decision makers take sound investment decisions. Besides the report
also identifies and analyzes the emerging trends along with essential drivers,
challenges, and opportunities in India LPG Market.
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