With 5k new filling stations, 1 cr CNG vehicles on Indian roads by FY25 possible: Report

India could have one crore CNG vehicles on the roads by 2024-25 if an additional 5,000 filling stations are added, thereby providing answers to calls for alternative sustainable and eco-friendly mobility, according to a report.

According to the report by Nomura Research Institute (NRI) Consulting, scaling up the total number of CNG stations from the current 1,349 to 5,000 could also result in crude oil imports saving by around Rs 95,000 crore by FY2024-25.

The estimated one crore CNG vehicles by 2024-25 will include passenger vehicles, three-wheelers and busses, according to the report.

"At present, the existing CNG stations in India support around a total of 30 lakh CNG vehicles and we are way below the global standards," NRI Consulting and Solutions Partner Ashim Sharma said.

Speaking on the sidelines of NGV India Summit by Messe Frankfurt, he said as per global standard one CNG station would cater to 1,500 vehicles only.

"Once we add 5,000 new CNG stations by FY25, we could be reaching close to the global benchmark," Sharma said.

When asked if the target of 5,000 CNG stations by FY25 is achievable, Adani Gas Ltd Senior Vice President (City Gas Distribution) Bhashit Dholakia said it could be possible when the new 86 geographical areas (GAs), for which bids have been opened for gas distribution licensing, comes through.

Sharma said CNG for automobiles is a proven technology in terms of eco-friendliness, providing better air quality and sustainability.

A favourable policy is required for promotion of natural gas vehicles (NGVs) through development of CNG infrastructure in order to increase customer acceptance and provide cost competitiveness, he added.

"A stable CNG pricing policy and selling environment needs to be set up to ensure that the total cost advantages of the vehicles are considered during purchase decisions," he said.

The report said fiscal incentives would go a long way in promoting NGVs. Apart from facilitating the establishment of additional 5,000 CNG stations by FY25, support must be given in purchase of CNG and LNG vehicles could be considered.

Moreover, attractive finance rates for NGVs, favourable VAT rates for gas fuels could also help in increasing adoption of NGVs, it added.

"For the automobile manufacturers, he said government could look at providing tax benefits on R&D activities in CNG technology improvements," Sharma added.

Maruti Suzuki India Vice-President (Corporate Planning and Government Affairs) Rahul Bharti said when there is proper infrastructure for CNG stations it could even encourage automobile manufacturers to develop pure CNG vehicles.

Currently, CNG is mostly offered as option in bi-fuel vehicles thereby compromising on boot space but despite that these vehicles are popular in cities where there are adequate CNG stations, he said.