India Launches First Domestic Natural Gas Futures Contract

The National Stock Exchange (NSE) is set to launch India's first domestic benchmark-linked natural gas futures contract on July 27. The cash-settled contracts will track the Indian Gas Exchange's Gujarat (Dahej) benchmark for price discovery.

The new derivative aims to improve risk management and deepen India's natural gas trading market by offering a benchmark that reflects domestic market conditions rather than international pricing trends.

According to the NSE, the futures contracts will be settled entirely in cash, with pricing based on the IGX Gujarat (Dahej) hub benchmark, quoted in ₹ per mmBtu. Each contract will have a trading unit of 250 mmBtu, with trading available from Monday to Friday.

NSE Clearing will oversee the clearing, settlement and risk management functions for the contracts. The exchange said daily mark-to-market settlements will be carried out using closing prices. Participants will also be subject to the prescribed initial margin, extreme loss margin and pre-expiry margin requirements under the existing risk management framework.