The hospitality industry is facing a growing crisis as a severe shortage of commercial LPG cylinders disrupts operations in several cities across the country.
Industry representatives warn that if supplies are not restored within the next two days, nearly half of the hotels and restaurants in Mumbai could be forced to temporarily suspend operations. According to Pradeep Shetty, Vice President of the Federation of Hotel and Restaurant Associations of India and spokesperson for the Hotel and Restaurant Association (Western India), the shortage has intensified over the past week. What began as intermittent disruptions has now escalated into a near complete halt in supply in several regions since Wednesday.
The disruption follows a notification issued on March 5 by the Ministry of Petroleum and Natural Gas. The notification has reportedly created confusion among suppliers and distributors, many of whom have stopped supplying commercial LPG cylinders to hotels, restaurants and food service establishments.
“We are already receiving reports of severe shortages from cities including Mumbai, Pune, Aurangabad and Nagpur, while similar disruptions are being reported in states such as Delhi, Karnataka, Telangana and Andhra Pradesh,” Shetty said.
Industry stakeholders fear the impact could be immediate and widespread. In Mumbai, nearly 50 percent of hotels and restaurants could be forced to shut temporarily depending on the stock of cylinders they currently hold. Smaller and medium-sized eateries are expected to be the first to feel the impact as they typically operate with limited reserves.
The situation could also affect travellers and tourists, including international visitors currently in the country as well as those planning to visit India. Restaurants and hotel kitchens rely heavily on commercial LPG for high-intensity cooking required for Indian cuisine.
The hospitality sector caters to millions of consumers daily, including working professionals, students and travellers. It also supports a large employment ecosystem through cloud kitchens, industrial kitchens and catering establishments.
During the COVID-19 pandemic, the hospitality industry was recognised as an essential service for supporting urban food supply chains, a role it continues to play in major cities across the country.
While alternative cooking options such as electric or induction systems are gradually emerging, industry representatives say they are not yet practical for most commercial kitchens that depend on high-speed, large-scale cooking operations. Transitioning to such systems would also require significant investment in infrastructure and equipment.
Industry bodies have urged authorities to immediately restore uninterrupted supply of commercial LPG to ensure that hotels, restaurants and food service establishments can continue operating without disruption.
KB Kachru, President, Hotel Association of India (HAI) and Chairman – South Asia, Radisson Hotel Group said, “Restaurant and hotel kitchens rely heavily on LPG for their operations, and any supply shortages or price hikes could disrupt their functioning across the country. While the HAI understands and appreciates the circumstances leading to energy shortage and price increases in LPG cylinders, the industry body is also concerned about the serious challenge it poses for its member hotels particularly in terms of business continuity.”
“Such disruptions pose a threat to industry as many small & medium-sized size establishments may be constrained to temporarily shut down on account of continued shortage of LPG causing hardships to all concerned. Irregular and non-availability of gas will certainly impact the sector. We appreciate the Ministry for establishing a 24/7 Control Room to monitor the supply and stock levels of petroleum products across the country. As gas supply is critical to the operation of the hospitality sector, we urge the government’s special consideration to treat our industry as an essential service and make arrangements to ensure supply without disruption to this sector, a vital pillar of employment generation and economic development,” added Kachru.