Gazprom will deliver 2.5 million tons of LNG per year to GAIL for the next 20 years.
Alexei Miller, the top executive at Gazprom, said the contract is part of his company's focus on Asian markets.
"We consider India to be one of the most booming markets in the region," he said in a statement.
Gazprom from 2009 to 2011 supplied India with about 600,000 tons of LNG delivered in 10 shipments. More than 85 percent of deliveries of LNG from Gazprom were to Asia-Pacific countries in 2011.
India suffered a massive blackout in July when more than 30 gigawatts of electricity were taken offline for about two days.
Long-term, India could get natural gas from Turkmenistan through a multilateral pipeline that would cross Afghan and Pakistani territory.
French energy company GDF Suez in August signed a deal with GAIL for the shipment of nearly 1 million tons of LNG through 2014.