NEW DELHI -
May 10, 2025 -
PRLog -- India's draft plan to promote LNG-powered heavy trucks is being hailed as a cleaner alternative to diesel freight. But a new analysis by
Indianpetroplus.com, India's leading energy intelligence platform, questions whether the country is replicating China's 2018-style LNG boom—at a time when China is already pivoting to electric trucks.
Feed-Gas Economics Could Undermine the Model - In China, domestic production of 246 bcm and piped imports of 77 bcm made mini-liquefiers viable and cheap.
- India, by contrast, depends largely on imported seaborne LNG, with prices pegged to volatile JKM indices.
- This volatility could erase the 20–30% cost benefit that justifies a switch from diesel.
Infrastructure Gaps Are Too Wide - By 2020, China had 86 inland liquefaction plants and 8,000+ LNG stations.
- India currently has no inland liquefiers and only 23 operational LNG stations, despite a government mandate for 49.
- The result: High cryogenic transport costs and deadheading for refueling, weakening the case for fleet conversions.
Vehicle Costs Delay Payback - China's LNG trucks cost ~18% more than diesel and recovered the premium in 6 months.
- India's only domestic LNG model costs ₹65 lakh vs ₹35–40 lakh for diesel rigs.
- With payback periods exceeding five years, many truckers are unwilling to invest—even with temporary government gas allocations.
Price Ratio & Electrification Threaten Long-Term Viability - LNG truck adoption in China collapsed when retail LNG exceeded 80% of diesel prices—a threshold India has breached multiple times since 2022.
- Meanwhile, China now subsidizes electric trucks 27–58% more than LNG models, and e-HDVs made up 20% of Q1 2025 sales.
- India's FAME-III scheme is expected to shift future freight incentives toward electric vehicles as well.
Policy Shift May Leave Assets Stranded - India's Net Zero roadmap targets 100% zero-emission trucks by 2050.
- If LNG infrastructure breaks ground now, it risks becoming a stranded asset before it amortizes—especially if battery freight achieves cost parity earlier than projected.
"India's LNG truck model faces structural limitations in fuel pricing, distribution density, and vehicle economics. Without inland gas and stable pricing, this infrastructure may not break even—especially as electric freight accelerates,"
said an analyst at Indianpetroplus.com.
Read the full analysis: https://www.indianpetroplus.com
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