Textile units in Surat’s industrial belts are scaling back operations as a sharp rise in LPG refill costs for small cylinders has triggered an exodus of migrant workers, raising concerns over production disruptions ahead of the festive season.
Industry sources report that LPG refill prices for small cylinders have surged from around Rs. 500 (US $5.37) to as high as Rs. 2,500 (US $27), rendering basic cooking unaffordable for many workers. Migrants from states including Uttar Pradesh, Bihar, Jharkhand, Uttarakhand and Odisha have begun returning home in significant numbers, leading several mills to suspend operations for one or two days each week due to labour shortages.
In response, some units have set up community kitchens or are providing meals directly to workers in an effort to retain their workforce. Local authorities are also monitoring gas distribution agencies to curb instances of black marketing, which has exacerbated the supply crunch.
At the same time, manufacturers are grappling with a sharp escalation in input costs. Yarn prices have risen by 25% to 45% within a short span, while the cost of dyes and chemicals has increased by around 20%. This has pushed up dyeing process costs by nearly 30%, further squeezing already thin margins. Industry participants indicated that production schedules are being adjusted to manage costs while maintaining output during a crucial demand period.
The disruption is linked to India’s heavy reliance on imported liquefied petroleum gas (LPG). The country sources roughly 60% of its LPG from imports, with nearly 90% of shipments passing through the Strait of Hormuz—a key maritime route vulnerable to geopolitical tensions in the Gulf region. Over the years, direct LPG imports have risen sharply, from 1,722 thousand metric tonnes in 1998–99 to 20,667 thousand metric tonnes in 2024–25, now accounting for about 40% of petroleum product imports by volume.
Industry stakeholders noted that this concentration of supply routes makes domestic fuel availability and pricing highly sensitive to geopolitical instability, particularly in conflict-prone regions. They added that affordable LPG is critical for sustaining migrant labour in industrial clusters such as Surat, where workers depend on small cylinders for daily cooking.
Stakeholders further indicated that if LPG supplies stabilise and black marketing is effectively controlled, mills may be able to retain sufficient labour to meet upcoming festive demand. However, they cautioned that prolonged shortages, combined with sustained increases in raw material costs, could deepen labour deficits and lead to extended production halts. Any escalation in tensions in the Gulf region, they warned, could further disrupt shipping routes and intensify shortages across multiple sectors.
