City Gas Distribution In India Market Size & Share Analysis - Growth Trends & Forecasts (2025 - 2030)

The Report Covers India City Gas Distribution Market Size & Share and It is Segmented by Type (Pipeline Natural Gas (PNG) and Compressed Natural Gas (CNG)) and End User (Automotive, Residential, Commercial, and Industrial). The Market Size and Forecasts for the India City Gas Distribution Market in Terms of Revenue (USD) for all the Above Segments.

City Gas Distribution In India Market Size & Share Analysis - Growth Trends & Forecasts (2025 - 2030)

India City Gas Distribution Market Size

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India City Gas Distribution (CGD) Market Summary
Study Period 2019 - 2030
Base Year For Estimation 2024
Forecast Data Period 2025 - 2030
Market Size (2025) USD 11.33 Billion
Market Size (2030) USD 20.93 Billion
CAGR (2025 - 2030) 13.06 %
Market Concentration Medium

Major Players

India City Gas Distribution (CGD) Market Major Players

*Disclaimer: Major Players sorted in no particular order

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India City Gas Distribution Market Analysis

The India City Gas Distribution Market size is estimated at USD 11.33 billion in 2025, and is expected to reach USD 20.93 billion by 2030, at a CAGR of 13.06% during the forecast period (2025-2030).

India's City Gas Distribution infrastructure has witnessed substantial expansion as part of the nation's broader energy transition strategy. As of March 2023, the country's CGD network encompasses 5,665 CNG stations and serves over 11 million domestic connections, demonstrating significant infrastructure development. The government's ambitious vision to transform India into a gas-based economy aims to increase natural gas's share in the energy mix from 6% to 15% by 2030, driving unprecedented growth in CGD infrastructure development. The Petroleum and Natural Gas Regulatory Board (PNGRB) has authorized 295 geographical areas across 27 states and UTs, covering approximately 88% of the country's geographical area and 98% of its population.


The industrial sector continues to dominate natural gas consumption through the CGD network, with recent data showing industrial users consuming approximately 12.1 MMSCMD compared to 2.5 MMSCMD in residential and 0.67 MMSCMD in commercial sectors. This consumption pattern reflects the growing adoption of natural city gas as a cleaner fuel alternative in industrial processes, particularly in sectors such as steel manufacturing, textiles, and food processing. The government's focus on reducing industrial emissions and promoting sustainable manufacturing practices has been a key factor in driving this industrial consumption pattern.


Significant developments in regional City Gas Distribution infrastructure are reshaping the market landscape. In June 2023, Megha City Gas Distribution Private Limited achieved a milestone by inaugurating its 100th CNG station at Keesara, Rangareddy district in Telangana, with plans to expand to 400 CNG stations and 200,000 PNG connections nationwide by 2024. Additionally, in March 2023, the Tamil Nadu government appointed TIDCO as a nodal agency to develop a comprehensive policy for accelerating CGD projects, aiming to provide 2.28 lakh domestic connections and 2,785 CNG filling stations across all 38 districts.


The City Gas Distribution network in India is being supported by strategic infrastructure development initiatives. The government plans to expand the national CNG refilling network to 17,700 stations by 2030, covering both urban and rural areas. This expansion is complemented by the development of gas pipeline infrastructure, with India currently having 21,715 km of operational natural gas pipelines, 14,240 km under construction, and 34,135 km of authorized pipelines. This comprehensive infrastructure development approach is creating a robust foundation for sustainable market growth and improved accessibility to distribution of natural gas in India across various sectors.

Segment Analysis: Type

CNG Segment in India City Gas Distribution Market

Compressed Natural Gas (CNG) has emerged as the dominant segment in India's city gas distribution market, commanding approximately 55% of the total market share in 2024. The segment's prominence is primarily driven by the increasing adoption of CNG vehicles across the country, particularly in the commercial transport sector, where rising prices of refined oil products have incentivized the switch to CNG-fired vehicles. As of March 2023, India has established a robust network of 5,665 CNG stations, with Gujarat leading the infrastructure development, followed by Uttar Pradesh. The government's mandate for stricter emission standards for new internal combustion engine (ICE) vehicles and the Cabinet Committee on Economic Affairs' approval of a new domestic natural gas pricing plan in April 2023, which reduced CNG costs by approximately 10% across the country, have further strengthened this segment's market position. CNG companies in India are pivotal in this transition, contributing to the segment's growth.

Market Analysis of India City Gas Distribution (CGD) Market: Chart for Type

PNG Segment in India City Gas Distribution Market

Pipeline Natural Gas (PNG) represents the fastest-growing segment in India's city gas distribution market, projected to expand at approximately 15% annually from 2024 to 2029. This remarkable growth trajectory is supported by the government's aggressive expansion of PNG infrastructure through various bidding rounds under the Petroleum & Natural Gas Regulatory Board (PNGRB). The completion of work allocated in the 11th and 11A bidding rounds is expected to significantly boost PNG connectivity across 295 geographical areas, covering about 88% of the country's geographical area and 98% of its population. The segment's growth is further catalyzed by increasing industrial demand, where PNG serves as a cleaner alternative to traditional fuels, and rising domestic connections driven by its cost-effectiveness and environmental benefits compared to LPG. PNG companies in India are instrumental in driving this expansion, ensuring widespread access to cleaner energy.

Segment Analysis: End User

Automotive Segment in India City Gas Distribution Market

The automotive segment dominates the India city gas distribution network, accounting for approximately 54% of the total market share in 2024. This significant market position is primarily driven by the increasing adoption of CNG vehicles across the country, particularly in major metropolitan areas. The segment's dominance is further strengthened by various government initiatives promoting CNG as an alternative fuel source, including mandates for CNG-operated taxis in regions like the National Capital Region (NCR). The automotive sector's growth is also supported by the expanding network of CNG filling stations, which reached over 5,665 stations across India as of March 2023. Major automobile manufacturers like Maruti and Hyundai are actively contributing to this growth by expanding their CNG vehicle portfolios, with projections suggesting that CNG vehicles could represent up to 50% of total vehicle sales in India by 2030.

Industrial Segment in India City Gas Distribution Market

The industrial segment represents the second-largest share in the CGD market, with significant potential for expansion across various manufacturing sectors. This segment primarily utilizes natural gas for heating purposes in industries such as steel manufacturing, tea processing, and brick production. The growth in this segment is being driven by the increasing number of small and medium-scale industries, supported by government initiatives such as the Emergency Credit Line Guarantee Scheme (ECLGS) and various financial assistance programs. The industrial sector's expansion is also facilitated by the government's push towards cleaner fuel alternatives and the implementation of stricter emission norms for industrial operations. Gas distribution companies play a crucial role in facilitating this transition to cleaner energy sources.

Remaining Segments in End User Segmentation

The residential and commercial segments, while smaller in market share, play crucial roles in the overall CGD market ecosystem. The residential segment is experiencing steady growth through the expansion of PNG connections to households, offering advantages such as uninterrupted gas supply and lower maintenance costs compared to traditional LPG systems. The commercial segment, primarily comprising hotels, restaurants, and other business establishments, is witnessing increased adoption of PNG connections due to its cost-effectiveness and environmental benefits. Both segments are benefiting from the government's ongoing initiatives to expand the CGD network and increase PNG accessibility across urban and semi-urban areas.

India City Gas Distribution Industry Overview

Top Companies in India City Gas Distribution Market

The Indian city gas distribution companies in India market is led by established players like Indraprastha Gas Limited, GAIL Gas Limited, Mahanagar Gas Ltd, and Adani Total Gas Ltd. These top gas distribution companies in India are focusing on expanding their geographical presence through strategic acquisitions and joint ventures to capture new territories and customer bases. Product innovation is primarily centered around developing advanced CNG/PNG infrastructure and implementing digital solutions for improved customer service. Operational agility is demonstrated through the hub-and-spoke distribution model, innovative gas supply methods including cryogenic cylinders, and composite dispensing units. Companies are also investing in backward integration by setting up manufacturing units for allied equipment like gas meters and compressors. The market is witnessing increased collaboration between public and private entities to develop city gas distribution networks across various geographical areas.

Public-Private Partnership Drives Market Growth

The Indian city gas distribution market exhibits a mix of public sector undertakings and private players, with a strong presence of government-backed companies through joint ventures. The market structure is characterized by regional monopolies where authorized entities have exclusive rights to operate in specific geographical areas. Many leading players are joint ventures between state-owned enterprises and private companies, combining public sector reliability with private sector efficiency. The market is witnessing increasing consolidation through strategic partnerships and acquisitions, as demonstrated by recent moves like Mahanagar Gas Limited's acquisition of Unison Enviro and the joint venture between Assam Gas Company and Oil India Limited.


The competitive landscape is evolving with the entry of new players through PNGRB's bidding rounds, though established players maintain their dominance through extensive infrastructure and experience. Market participants are increasingly forming strategic alliances to share resources, expertise, and infrastructure, particularly in new geographical areas. The industry is seeing a trend of vertical integration, with CGD companies expanding across the value chain from gas sourcing to end-user distribution. Companies are also diversifying into adjacent sectors like compressed biogas production and electric mobility to maintain a competitive advantage.

Innovation and Sustainability Drive Future Success

Success in the Indian city gas distribution market increasingly depends on technological innovation, operational efficiency, and environmental sustainability. Companies need to focus on developing smart infrastructure, implementing digital solutions for customer service, and optimizing their distribution networks to maintain a competitive advantage. Market players must also invest in renewable gas solutions and eco-friendly technologies to align with the government's clean energy objectives. Building strong relationships with automotive manufacturers, industrial customers, and residential developers is becoming crucial for maintaining market share. Companies need to develop robust risk management strategies to handle gas price volatility and supply chain disruptions.


New entrants can gain ground by focusing on underserved markets and developing innovative business models that address specific regional needs. Success factors include establishing efficient procurement strategies, developing strong local partnerships, and investing in customer service infrastructure. Companies must also prepare for potential regulatory changes, particularly around safety standards and pricing mechanisms. The ability to adapt to changing customer preferences, particularly in the automotive sector with the rise of electric vehicles, will be crucial. Future success will depend on companies' ability to balance expansion with operational efficiency while maintaining strong relationships with stakeholders across the value chain. The CGD business is poised for growth as companies adapt to these evolving market dynamics.

India City Gas Distribution Market Leaders

  1. Indraprastha Gas Limited

  2. Mahanagar Gas Ltd

  3. GAIL Gas Limited

  4. Gujarat Gas Ltd.

  5. IndianOil-Adani Gas Pvt. Ltd.

  6. *Disclaimer: Major Players sorted in no particular order
India City Gas Distribution (CGD) Market Concentration
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India City Gas Distribution Market News

  • June 2024: The Petroleum and Natural Gas Regulatory Board (PNGRB) organized a Roundtable Discussion with its stakeholders to understand the overall landscape of PNG Stoves and Retrofitted LPG Stoves. With increasing dependence on natural gas, the organization, along with Academic Research Institutions, CGD Entities, and Stove Manufacturer companies, deliberated on adopting highly efficient domestic PNG stoves.
  • April 2024: A Japanese consortium announced its plans to invest USD 370 million in a firm led by ISquared Capital, a global infrastructure investor. The consortium targets to invest in the city gas distribution network in India.

India City Gas Distribution Market Report - Table of Contents

1. INTRODUCTION

  • 1.1 Scope of the Study
  • 1.2 Market Definition
  • 1.3 Study Assumptions

2. EXECUTIVE SUMMARY

3. RESEARCH METHODOLOGY

4. MARKET OVERVIEW

  • 4.1 Introduction
  • 4.2 Market Size and Demand Forecast in USD, till 2029
  • 4.3 Number of PNG Connections and CNG Stations, By Location, India, as of July 2024
  • 4.4 Recent Trends and Developments
  • 4.5 Government Policies and Regulations
  • 4.6 Market Dynamics
    • 4.6.1 Drivers
    • 4.6.1.1 Rising Demand for CNG Vehicles
    • 4.6.1.2 Increased Government Efforts To Decarbonize The Residential And Transport Sector
    • 4.6.2 Restraints
    • 4.6.2.1 Rising Demand for Electric Vehicles
  • 4.7 Supply Chain Analysis
  • 4.8 PESTLE Analysis

5. MARKET SEGMENTATION

  • 5.1 Type
    • 5.1.1 Pipeline Natural Gas (PNG) Connections
    • 5.1.2 Compressed Natural Gas (CNG) Connections
  • 5.2 End User
    • 5.2.1 Automotive
    • 5.2.2 Residential
    • 5.2.3 Commercial
    • 5.2.4 Industrial

6. COMPETITIVE LANDSCAPE

  • 6.1 Mergers and Acquisitions, Joint Ventures, Collaborations, and Agreements
  • 6.2 Strategies Adopted by Leading Players
  • 6.3 Company Profiles
    • 6.3.1 Indraprastha Gas Limited
    • 6.3.2 Mahanagar Gas Ltd
    • 6.3.3 GAIL Gas Limited
    • 6.3.4 Gujarat Gas Ltd
    • 6.3.5 Maharashtra Natural Gas Ltd
    • 6.3.6 Haryana City Gas Distribution Network Ltd
    • 6.3.7 Aavantika Gas Ltd
    • 6.3.8 Sabarmati Gas Ltd
    • 6.3.9 Assam Gas Company Ltd
    • 6.3.10 Adani Total Gas Ltd.
    • 6.3.11 Torrent Group
  • *List Not Exhaustive

7. MARKET OPPORTUNITIES AND FUTURE TRENDS

  • 7.1 Development of Hydrogen Transportation
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India City Gas Distribution Industry Segmentation

City Gas Distribution (CGD) networks are a network of underground Natural Gas pipelines that distribute Piped Natural Gas (PNG) and Compressed Natural Gas (CNG) to residential, commercial, industrial, and retail outlet clients. The pipelines vary in size and pressure significantly. The designed pressure is always customized as per the end user's requirement.

The India city gas distribution (CGD) market is segmented by type and end user. By type, the market is segmented into pipeline natural gas (PNG) connections and compressed natural gas (CNG) connections. By end user, the market is segmented into automotive, residential, commercial, and industrial. For each segment, the market sizing and forecasts have been done based on revenue (USD).

Type Pipeline Natural Gas (PNG) Connections
Compressed Natural Gas (CNG) Connections
End User Automotive
Residential
Commercial
Industrial
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India City Gas Distribution Market Research FAQs

How big is the India City Gas Distribution Market?

The India City Gas Distribution Market size is expected to reach USD 11.33 billion in 2025 and grow at a CAGR of 13.06% to reach USD 20.93 billion by 2030.

What is the current India City Gas Distribution Market size?

In 2025, the India City Gas Distribution Market size is expected to reach USD 11.33 billion.

Who are the key players in India City Gas Distribution Market?

Indraprastha Gas Limited, Mahanagar Gas Ltd, GAIL Gas Limited, Gujarat Gas Ltd. and IndianOil-Adani Gas Pvt. Ltd. are the major companies operating in the India City Gas Distribution Market.

What years does this India City Gas Distribution Market cover, and what was the market size in 2024?

In 2024, the India City Gas Distribution Market size was estimated at USD 9.85 billion. The report covers the India City Gas Distribution Market historical market size for years: 2019, 2020, 2021, 2022, 2023 and 2024. The report also forecasts the India City Gas Distribution Market size for years: 2025, 2026, 2027, 2028, 2029 and 2030.

India City Gas Distribution (CGD) Market Research

Mordor Intelligence delivers a comprehensive analysis of the city gas distribution sector. We leverage our extensive expertise in CGD industry research. Our report covers the evolving landscape of gas distribution companies across India, including both established and private CGD companies in India. The analysis encompasses the entire CGD network, from natural city gas infrastructure to distribution systems. It provides detailed insights into CNG companies in India and PNG companies in India. The report examines the robust growth of the CGD sector and its impact on various stakeholders, including domestic gas companies in India.

The report, available as an easy-to-download PDF, offers stakeholders crucial insights into gas distribution dynamics and emerging opportunities within the CGD business. It provides a detailed analysis of top gas distribution companies in India and emerging players in the industrial and commercial natural gas distribution market. Our research benefits investors, policymakers, and industry participants by offering comprehensive coverage of distribution of natural gas in India. This includes a detailed examination of city gas distribution networks and infrastructure development. The report also includes an analysis of CNG market size in India and the expanding role of CNG providers in India. It is an essential tool for strategic decision-making in the CGD sector.

City Gas Distribution Market in India Report Snapshots