On Monday, Indian Gas Exchange (IGX), the country's first natural gas exchange, was launched online by Dharmendra Pradhan, minister of petroleum and natural gas.
IGX, set up by the Indian Energy Exchange (IEX), will offer the option of both just buying the product as well as purchase along with delivery.
Plans to set up the exchange were made a few years ago to tap into the increasing demand for clean fuel.
In February, the Indian Gas Exchange (IGX) had invited members to be part of its platform ahead of its formal launch. IGX has 12 members and 300 plus clients so far which includes buyers, sellers and users.
The NDA government has been working on pushing Natural Gas usage in the country as India is the biggest emitter of greenhouse gases after the US and China and plans to reduce its carbon emissions by 33-35 percent from its 2005 levels by 2030, as part of its commitments to the United Nations Framework Convention on Climate Change adopted by 195 countries in Paris in 2015.
Worsening air quality and also the country's dependence on imported crude oil has altered energy planning. India plans to increase the share of natural gas in its energy mix to 15 percent by 2030 from the current 6 percent.
A gas trading hub will help people buy and sell gas directly, acting as a spot market, keeping the price of natural gas competitive.
According to a Mint report, liquefied natural gas (LNG) terminal owners, state-run GAIL (India) Ltd and Petronet LNG Ltd (PLL) have joined IGX. Other players such as Manikaran Power, Torrent Power, Adani Gas, Geeta Power, GMR Group, Piramal Glass, Asahi Glass, Gujarat State Fertilizers & Chemicals Ltd, Gujarat Narmada Valley Fertilizers & Chemicals, Krishak Bharati Cooperative Ltd, Saint Gobain, Kajaria Ceramics, Bhagyanagar Gas, Maharashtra Natural Gas Ltd, Haryana City Gas and Gujarat Borosil, have joined as members or clients.
However, inadequate gas pipeline infrastructure and natural gas not being a part of the Goods and Services Tax (GST) regime are some of the concerns associated with the growth of the sector.