According to a report by the Nomura Research Institute (NRI) Consulting and Solutions India, India needs to bring CNG under the GST regime and meet challenges such as high vehicle costs and limited boot space for the growth of the natural gas vehicle market.
The ‘Natural Gas Vehicle (NGV) Market’ report states that the CNG vehicle market has seen an annual growth rate of 7% to 33.76 lakh units in March 2016 to March 2020, mainly for passenger vehicles (cars and taxis). Is operated by. However, the demand for such vehicles is concentrated in five states / UTs of Maharashtra (30%), Gujarat (29%), Delhi (23%), Uttar Pradesh (9%) and Haryana (5%).
India has larger domestic reserves of natural gas than crude oil. India has discovered around 5 TCMs of recoverable reserves, of which less than 0.5% is used as fuel in the current CNG fleet, “adding to the high vehicle volumes and favorable conditions in the Indian automobile market, Said that the NGV presented an opportunity to promote the wider vehicle sector.
However, high vehicle costs, vehicle weight, and limited boot space were some of the challenges that needed to be resolved to promote NGV adoption. The report states that natural gas-powered vehicles are 12–18% more expensive than petrol variants, 10–15% heavier and 40–50% less boot space due to cylinder installations.
Additionally, domestic production of natural gas was limited so that the size of reserves and investment in exploration and production was required.
For CNG vehicles, the report states that the government and other stakeholders need to operate at attractive financing rates, simplification of land acquisition laws for pipeline and station development, GST or uniform pricing policy and tax structure in states Under the launch of CNG, and a detailed construction roadmap and implementation plan for realizing the full potential of domestic natural gas production.
It also suggested the localization of cryogenic cylinders, which are currently being imported, to reduce the cost of LNG trucks and to establish sufficient LNG fuel stations to meet demand by long-haul trucks operating in India To go.
Currently, China leads with the largest NGV fleet in the world with strong infrastructure, government policies and natural gas availability, followed by Iran, India, Pakistan, Argentina, Brazil and the US.
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