Hi
Thank you for reaching out to us on the Microsoft Q&A forum.
We understand your concern, let's break down the issue.
Azure Virtual Network Gateway is used for connecting Azure to an on-premises network / external locations (E.g: via VPN / ExpressRoute). It doesn’t handle connections between virtual networks within Azure.
VNet Peering, on the other hand, is designed specifically to connect virtual networks to each other inside Azure, even across regions. This makes it the right answer for combining cross-premises and inter-virtual network connectivity.
For example, think of it this way:
Virtual Network Gateway = Connect Azure to the outside world.
VNet Peering = Connect networks within Azure.
That’s why VNet Peering is the correct answer.
Referral link: https://learn.microsoft.com/en-us/azure/vpn-gateway/vpn-gateway-howto-vnet-vnet-resource-manager-portal
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Thank you.