The National Stock Exchange of India is in discussions with the Indian Gas Exchange to develop and launch India’s first domestic natural gas futures contract, the two entities announced on Thursday.
The proposed collaboration aims to provide market participants with a transparent risk management tool aligned with India’s evolving natural gas pricing framework. The futures contract would combine NSE’s expertise in derivatives trading with IGX’s leadership in spot gas trading and price discovery.
Market hedging
The initiative is expected to benefit a wide range of stakeholders, including gas producers, city gas distribution companies, power generators, fertiliser manufacturers, industrial consumers, traders and financial participants by enabling effective hedging against price volatility.
Sriram Krishnan, Chief Business Development Officer at NSE, said the collaboration marks a significant step in deepening India’s commodity derivatives markets. He noted that natural gas is emerging as a critical transition fuel for India’s energy mix, and a domestic futures contract will enhance price transparency and improve risk management capabilities.
The proposed partnership aligns with India’s broader objective of increasing the share of natural gas in its energy basket and promoting market-based pricing mechanisms. The launch is subject to regulatory approvals, and both exchanges will work with stakeholders to ensure a smooth rollout.
Contract design details and launch timelines will be announced later. NSE is currently the world’s largest derivatives exchange by trading volume, while IGX operates India’s authorized natural gas trading platform under PNGRB regulation.