The Centre has increased the allocation of commercial LPG cylinders to 70% of demand, up from 50%, in a bid to ease supply constraints impacting industrial and commercial users amid disruptions in imports linked to the Iran war.
The revised allocation includes an additional 20% over the existing 50%, restoring supply to 70% of pre-crisis levels of packed non-domestic LPG, according to a government order. The move is expected to provide near-term relief to energy-intensive sectors.
Priority allocation will be extended to labour-intensive industries such as steel, automobiles, textiles, dyes, chemicals, and plastics, particularly where LPG is critical for specialised heating processes that cannot be substituted by natural gas.
To access the incremental 20% allocation, commercial and industrial users are required to register with oil marketing companies and apply for piped natural gas (PNG) connections through city gas distribution networks. However, exemptions will be granted to industries where LPG use is integral and non-substitutable.
The government has also urged states to utilise an additional 10% reform-based allocation, which would further support industrial operations and stabilise supply chains.
Earlier measures prioritised sectors including hospitality, food processing, and community kitchens, alongside provisions for migrant labourers. As per official data, over 37,000 5-kg free trade LPG cylinders have been distributed to migrant workers as of March 25.
Distribution will be managed by state and district authorities based on local demand priorities. In a parallel development, Iran has indicated willingness to allow more Indian LPG shipments through the Strait of Hormuz following diplomatic engagements, potentially easing supply-side pressures.
