The International Energy Agency (IEA) has urged India to reform its natural gas sector by liberalizing gas pricing and unbundling marketing and transportation businesses to boost investment and efficiency. In its latest energy policy review, the IEA emphasized that a competitive and transparent gas market is crucial for India’s growing energy needs and economic development.
India currently regulates gas prices for domestic production, which affects market competitiveness and discourages new investments. The IEA suggests moving towards a market-driven pricing mechanism that would attract foreign investment and enhance domestic production. Additionally, the agency recommends separating gas marketing from transportation infrastructure to promote fair access and prevent monopolistic practices.
By implementing these reforms, India can strengthen its gas sector, improve supply security, and ensure affordable energy for consumers. The move aligns with India’s goal of increasing the share of natural gas in its energy mix to 15% by 2030, reducing dependence on coal and supporting environmental sustainability.
The government has already taken steps towards gas sector reforms, including the introduction of the Indian Gas Exchange. However, full market liberalization, as recommended by the IEA, is essential for realizing the full potential of India’s natural gas industry.
