Chokkapan S (cbedit@imaws.org)
A deepening shortage of commercial Liquefied Petroleum Gas (LPG) cylinders — as a fallout of the United States-Israel-Iran war in the Middle-East — is pushing the food industry across Karnataka and Tamil Nadu towards a critical tipping point. Over the past few days, hotels, restaurants and catering establishments in major cities such as Bangalore, Chennai, Coimbatore and Madurai have been grappling with severe disruptions in LPG supplies — the primary cooking fuel that powers their kitchens.
What initially appeared to be a temporary supply hiccup has now snowballed into a widespread operational crisis. Hotel associations warn that unless supplies are restored immediately, thousands of establishments could be forced to suspend operations within days, triggering a cascading impact on food supply chains, employment and local economies. With millions of citizens relying on restaurants for their daily meals, the unfolding situation is rapidly becoming one of the most serious challenges faced by the hospitality industry since the pandemic.
The situation has already forced many establishments to scale down operations, trim their menus or temporarily suspend services. Industry bodies warn that if the disruption continues, a large number of food businesses could be compelled to shut down entirely within days.
Bangalore on the Verge of Shutdown
In Karnataka, hotel associations point out that the crisis has escalated rapidly due to the near absence of clarity from authorities or oil marketing companies regarding the restoration of supplies.
“As far as Bangalore is concerned, there is absolutely no clarity from either the government or oil companies or agencies. This crisis will force most of the hotel businesses to shut shop by Tuesday evening, or maximum by Wednesday. Many perishable goods, including the daily supply of 30 lakh litres of milk, will go down the drain as a consequence. It will also severely upset the supply chain as well as negatively impact the local economy. We have escalated the issue to the Centre through our state MPs, who have assured us with their positive response,” informed Veerendra Kamat, Secretary of the Bangalore Hotels Association (BHA).
Hotel associations say the availability of commercial LPG cylinders has dropped drastically over the past few days, with many distributors either delaying deliveries or stopping supplies altogether.
KSHA flags Alarming Supply Drop
According to M.V. Raghavendra Rao, Honorary Secretary of the Karnataka State Hotels Association (KSHA), the availability of commercial LPG cylinders has plunged to critical levels. “We are already witnessing only 30 per cent availability of commercial LPG cylinders. Hotels, restaurants and other businesses entirely dependent on these cylinders are already facing the heat with the looming shortage. After we have written to the Union government, we have got an assurance that the issue will be sorted as soon as possible,” he said. The KSHA, which represents nearly one lakh hotels and restaurants across the state, formally sent a letter to the Union Petroleum and Natural Gas Minister, Hardeep Singh Puri, on Monday seeking urgent intervention.
KSHA President Gopalkrishna Shetty, in the association’s plea to the government, pointed out that “irregular deliveries and delays in the supply of commercial LPG cylinders over the past few days have severely disrupted hospitality operations across the state.” He noted that the industry is heavily dependent on LPG for cooking and food preparation, and continued disruptions could lead to operational inefficiencies, increased costs and temporary shutdowns.
The association also expressed concern that the reduction in production of commercial cylinders and the diversion of supply towards domestic consumption have worsened the crisis. According to the association, nearly 70 per cent of urban residents depend on hotels and food outlets for their daily meals, thereby underlining the seriousness of the issue. KSHA has further raised concerns about possible black-market trading and hoarding of LPG cylinders, urging the Union government to investigate supply chain irregularities and ensure uninterrupted distribution to the hospitality sector.
Tamil Nadu Industry seeks Urgent Intervention
A similar alarm has been sounded in neighbouring Tamil Nadu, where hotel and restaurant owners warn that a prolonged disruption in LPG supply could lead to widespread closures across the state. The Tamil Nadu Hotels Association (TNHA) has appealed to the Centre for immediate intervention to ensure uninterrupted supply of commercial LPG to the hospitality and food service sector.
According to M. Venkadasubbu, President of TNHA, the sector relies almost entirely on LPG for its day-to-day operations. He categorically stated that any sudden restriction or stoppage in commercial LPG supply would have severe consequences for the hospitality industry, in particular, and the wider economy as well.
The Tamil Nadu association chief emphasised that the hospitality sector in Tamil Nadu alone comprises over one lakh establishments, employing more than 50 lakh workers directly, while supporting millions more indirectly through agriculture, transport, tourism and other related sectors. He also noted that millions of citizens — including students, office-goers, travellers and daily wage earners — depend on restaurants and hotels for their daily food requirements, making uninterrupted fuel supply critical to public food access.
It’s along the same lines several industry representatives warn that a sustained disruption could trigger immediate shutdowns of restaurants, major food supply disruptions, large-scale unemployment and severe financial losses for small and medium entrepreneurs.
Restaurants begin Scaling Down Operations
The crisis is already forcing several businesses to rethink their operations. In Coimbatore, the management of the well-known Annapoorna hotel chain has announced temporary operational adjustments in response to the LPG shortage.
“Due to the ongoing geopolitical crisis in the Middle-East, the restaurant industry is currently facing significant constraints in LPG supplies. As LPG is our primary fuel source, we are experiencing daily shortages,” stated the hotel group run by D. Srinivasan, Managing Director, who is also Member of the Tamil Nadu State Food Commission.
To avoid a complete shutdown of services, the group has introduced temporary measures, such as reducing menu offerings to essential items and revising product availability timings. The management is actively engaging with both government authorities and suppliers to restore normal supply as quickly as possible.
Smaller Towns too Face the Heat
The ripple effects of the LPG shortage are now spreading beyond major cities. In several districts and towns across Tamil Nadu, restaurant owners say commercial LPG supplies from oil marketing companies have nearly come to a halt.
“Commercial LPG cylinder supplies from all oil companies — BPCL, HPCL and IOCL — have come to a near standstill. Illegal hoarding of gas cylinders also seems to be rampant. Apart from that, the prices of several petroleum byproducts, including packaging materials, have gone up by 10–30 per cent over the past few days,” said Ambur P. Babu, Secretary of the Tirupathur Hotel Owners’ Association.
Echoing these concerns, R. Srinivasan, Honorary Secretary of the Tamil Nadu Hotels Association and a restaurateur from Madurai, said the crisis is rapidly spreading across multiple districts in the state. He warned that if LPG supplies are not restored immediately, many hotels and eateries in smaller cities could be forced to suspend operations.
Policy Trigger and Industry Concerns
Industry leaders say the current crisis appears to be linked to the Union government’s recent order prioritising LPG supply for domestic consumers under the Essential Commodities Act and the Petroleum Products Order. While hotel associations acknowledge the importance of ensuring uninterrupted domestic LPG supply for households, they argue that a complete disruption of commercial LPG supply could severely damage the hospitality sector.
With the industry still recovering from the devastating impact of the pandemic years, all stakeholders feel another major disruption could threaten the survival of thousands of small and medium food businesses across the two southern states.
A Sector Waiting for Urgent Relief
As industry bodies escalate their appeals to policymakers from the Union government and oil marketing companies, the hospitality sector now finds itself in a race against time. For thousands of small and medium restaurants, the crisis is no longer a distant policy issue, but a daily operational struggle to keep their kitchens running. Without swift intervention, industry leaders warn, the current LPG shortage could soon translate into widespread shutdowns of restaurant kitchens, major supply chain disruptions and serious economic consequences across Karnataka and Tamil Nadu.
Beyond the immediate impact on businesses, such a scenario could disrupt food access for millions, stall local supply chains and place immense strain on an industry that is still rebuilding after years of pandemic-induced losses.
For now, the flame in many restaurant kitchens flickers uncertainly — waiting for immediate relief. Lest it goes out altogether.
Fact Box: The LPG Crisis at a Glance
- 30% availability of commercial LPG cylinders reported in several regions
- 1 lakh+ hotels and restaurants represented by the Karnataka State Hotels Association
- Over 1 lakh hospitality establishments estimated across Tamil Nadu
- 50 lakh direct jobs supported by the hospitality sector in Tamil Nadu
- Millions of indirect livelihoods linked through agriculture, transport, tourism and food supply chains
- 70% of urban residents in many cities depend on food outlets for daily meals
- 10–30% increase in prices of petroleum byproducts, such as packaging materials
- Multiple reports of black-market cylinder sales and hoarding
