If he is happy and doesn't seem to be bothered by it, then there is nothing to worry about. Toddlers tummies often seem very distended, but they will grow out of it around 4 years or so. If he seems very gassy, then you will have to eliminate different foods from his diet that you think might be the culprit. Usually you start with milk products because most kids have trouble with them more than others.

Food allergies do not affect growth. You are right in thinking that it is genetic.