This report is from this week's CNBC's "Inside India" newsletter which brings you timely, insightful news and market commentary on the emerging powerhouse and the big businesses behind its meteoric rise. Like what you see? You can subscribe

India is hungry for energy, and it's doing something about it.

As the country's population grows — already the world's largest — and becomes wealthier, its energy demand is expected to rise.

It's no wonder then that the South Asian nation aims to quadruple its natural gas use from the current level by 2030 to meet that demand and enable GDP growth rates of seven or eight percent annually.

However, many readers might ponder why India is buying into an energy source that nearly brought Europe to its knees only a few years ago.

The Russian invasion of Ukraine came alongside skyrocketing gas prices across Europe as Moscow turned off the taps and nearly held the continent's economy hostage. The nature of the gas market, then, meant buyers begged, bribed, or bullied sellers into supplying gas to keep their lights on.

So why does India want to deepen its ties with such a volatile energy source?

It might not have a choice and maintaining the status quo means rising energy security risks as its economy grows.

Currently, more than 80% of India's energy needs are met by coal, oil and solid biomass, according to the International Energy Agency. Both coal and oil imports have risen rapidly as the population takes a liking to round-the-clock electricity and car ownership.

Oil accounted for more than 70% of imports in Russia, Iraq and Saudi Arabia — three countries that don't have strong democratic credentials.

On the demand side, the Indian government has aggressively pushed policies that favor vehicles powered by compressed natural gas (CNG), a derivative of liquified natural gas (LNG).

These vehicles have taken off faster than electric vehicles as a good distribution network for the fuel has lowered range anxiety. They're also typically cheaper to run on a per-mile basis. That's allowed sales to rise 33% this year to more than half a million vehicles, with Maruti Suzuki taking the lion's share of the market.

Earlier this year, the government also unveiled plans to have a third of heavy-duty trucks in the country run on LNG instead of diesel, which currently makes up the bulk of refined fuel, over the next five to seven years.

Aside from transport, LNG use has grown thanks to government policy encouraging natural gas for domestic cooking. Piped connections have grown 250% to 11.9 million over the seven years ending November 2023, according to the Institute for Energy Economics and Financial Analysis. Meanwhile, the number of households that could receive piped natural gas is more than 300 million.

India also appears to be happy to import LNG, even from unsavory partners, if it helps balance risks in other parts of its economy. For instance, natural gas is a crucial ingredient for making fertilizers, and manufacturing it domestically helps increase food security.

Rystad Energy, a consultancy, has forecasted that the demand for natural gas will likely double by 2040. The research firm also expects India to be unable to meet its demand entirely through domestic sources and will have to rely "heavily" on imports to meet its needs.

As imports rise, this will likely benefit companies that are government-owned entities such as Petronet, which owns two LNG import terminals in the country, and gas distributor GAIL.

Investment banks like Citi and JPMorgan and local brokers say a steady rise in volume growth without making gas more expensive for consumers will benefit both stocks.

Indraprastha Gas (IGL), Mahanagar Gas (MGL) and Gujarat Gas are other distribution companies set to reap from the growing trend.

"We prefer PLNG to GAIL on a) lower valuations and b) the volatility in GAIL's gas trading segment," said JPMorgan analysts in a note to clients in June. Meanwhile, Citi analysts in August said, "We continue with our preference for GAIL, MGL, and IGL among the gas stocks."

Canada alleges Indian involvement in Sikh separatists plot. The Canadian government alleged this week that Indian Minister of Home Affairs Amit Shah is behind plots targeting Sikh separatists in Canada. The allegation was revealed by Canadian Deputy Foreign Affairs Minister David Morrison, who told a parliamentary panel he had confirmed to a U.S.-based newspaper t . India has previously dismissed the claims as baseless.

India is confident it can hit its 7% growth target for its 2025 financial year. The country's Secretary of the Department of Economic Affairs Ajay Seth said on Tuesday the goal is "very much doable." Seth is also for its third and fourth quarters despite slower capital expenditure in some states. India's fiscal year runs from April 1 to March 31 the following year.

The Reserve Bank of India lowered its forecast for India's second-quarter growth. Previous estimates by the RBI put GDP growth during India's fiscal second-quarter — which is from July to September — at 7.2%. However, the RBI , attributing it to weakness in areas like Nifty earnings forecasts and goods and service tax collections.

Indian stocks are struggling to maintain momentum. The index has essentially traded flat this week. The index has risen 11.4% this year.

Similarly, the benchmark 10-year Indian government bond yield has been muted this week trading 3 or 4 basis points around 6.83%.

On CNBC TV this week, Aravind Maiya, CEO of Embassy REITs, observed that there are more companies in India. Of the Fortune 500 companies, 23% have a GCC in India, said Maiya, and that proportion is expected to go up to 43% in the next five-to-six years. Crucially, those centers are now so-called "transformation hubs" engaging in cutting-edge work, rather than the support centers they were in the past.

Meanwhile, Landsberg Bennett Private Wealth Management's Chief Investment Officer Michael Landsberg said investors should diversify their portfolios outside the U.S. for growth. Specifically, , because the country's growth is two-to-three times higher than that of the U.S.

Important economic data to keep an eye on are U.S. personal consumption expenditure price index and U.S. nonfarm payrolls. Afcons Infrastructure, a construction company in India, lists on Monday.

November 1: U.S. nonfarm payrolls for October, China Caixin Manufacturing PMI for October

November 4: Afcons Infrastructure IPO

November 5: U.S. ISM PMI for October, India HSBC PMI final for October

November 7: China balance of trade for October