What happened?
According to a report by consultancy firm Wood Mackenzie, India’s natural gas production is expected to peak in 2025, growing by 4.5% before declining at an average rate of 3.6% annually until 2030 due to ageing fields and project delays. After 2030, production could fall even faster—by 9% annually—driven by resource exhaustion and fewer new discoveries. As domestic output shrinks, India’s dependence on imported liquefied natural gas (LNG) will surge, making it the world’s third-largest LNG importer after China and Japan by 2032.
Why it matters to India:
Rising import dependence threatens India’s energy security, exposing the economy to global price fluctuations and supply disruptions, especially amid geopolitical tensions. This could strain the trade balance, increasing the current account deficit. Additionally, costlier LNG imports may impact industries like fertilisers, refining, and city gas distribution, raising operational costs and consumer prices. To mitigate these risks, India must implement effective policy reforms, attract private investments, and fast-track domestic exploration projects, as outlined in the Oilfields (Regulation and Development) Amendment Bill introduced in 2024.