Centre raises commercial LPG allocation to 50%, prioritises key sectors amid supply concerns

The government has increased commercial LPG allocation to 50% by adding an extra 20% supply to states, prioritising sectors such as restaurants, hotels, industrial canteens and community kitchens.

The government has allotted an additional 20 per cent of Liquefied Petroleum Gas (LPG) to commercial users, bringing the overall allocation to 40 per cent. This additional quantity will be supplied to states, who will allocate it in turn to hotels, restaurants, etc.

Separately, the centre is also allocating another 10 per cent of the log to states based on ease of doing reforms for piped natural gas (PNG) expansion.

Overall allocation raised to 50 per cent

The Centre, in a Saturday order, allowed another 20 per cent allocation of commercial LPG to States, bringing the overall allocation to 50 per cent, the Ministry of Petroleum & Natural Gas (MoPNG) said.

This additional allocation shall be given priority to sectors such as restaurants, dhabas, hotels, industrial canteens, food processing/dairy, subsidised canteens/outlets run by State Govt. or local bodies for food, community kitchens, and 5 Kg FTL for migrant labourers, it added.

State-level implementation and supply status

Twenty States and UTs have issued orders to allocate Non-domestic LPG in line with the Government’s guidelines. In the remaining States/UTs, PSU Oil Marketing Companies (OMCs) are releasing Commercial LPG cylinders.

A total of around 13,479 tonnes of LPG has been uplifted by commercial entities in the States/UTs over the last week. Educational Institutions and Hospitals have been prioritised, and around 50 per cent of the total commercial LPG allocation is going to these sectors.

Supply concerns amid geopolitical tensions

Even as LPG supply remains a concern due to the prevailing geopolitical situation, there have been no reported dry-outs at distributorships.

Despite the war situation in West Asia, the government has given the highest priority to Domestic LPG and PNG, as well as to hospitals and educational institutions. Commercial consumers in major cities and urban areas have been requested to switch to PNG.

India’s LPG consumption and import dependence

India consumed more than 33 million tonnes (mt) of LPG in FY25, of which 20.67 mt was imported. About 90 per cent of this imported quantity, or roughly 60 per cent of India’s total consumption, came from the Gulf, transiting the Strait of Hormuz (SoH).

Published on March 21, 2026