India's Restaurant Sector Faces ₹79,000 Crore Monthly Loss Due to LPG Shortage
Restaurants face ₹79,000 cr hit as LPG supply dips
The Economic TimesImage: The Economic Times
India's restaurant industry is experiencing a significant economic impact, with an estimated monthly loss of ₹79,000 crore (approximately $9.5 billion USD) due to a shortage of commercial liquefied petroleum gas (LPG). This disruption affects various establishments, leading to operational challenges, job risks, and changes in consumer behavior.
- 01The restaurant sector is losing about ₹79,000 crore monthly due to LPG supply issues.
- 02Around 10% of restaurants have temporarily closed, with many shifting to alternative cooking methods.
- 03The industry employs over 8.5 million people, with potential job losses of 500,000 to 700,000.
- 04Consumer dining frequency has declined by 8-10%, impacting overall sales.
- 05The sector's heavy reliance on LPG highlights vulnerabilities in energy dependence.
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A report by the PHD Chamber of Commerce and Industry (PHDCCI) reveals that India's restaurant sector is facing a staggering monthly economic loss of ₹79,000 crore (approximately $9.5 billion USD) due to a shortage of commercial liquefied petroleum gas (LPG). This disruption has created operational challenges for a wide range of establishments, from independent restaurants to large hotel kitchens. The Indian food services market, valued at ₹5.69 lakh crore in 2024, is projected to grow, but current LPG supply constraints have led to a 15-20% slowdown in throughput, equating to a daily economic activity reduction of ₹2,650 crore. As a result, nearly 10% of restaurants have temporarily shut down, and 60-70% have adapted by using induction cooking or reducing menus. The ongoing crisis poses risks to employment, with potential job losses of 500,000 to 700,000 and hiring freezes, particularly among smaller operators. The report also highlights the broader implications for urban food access, as restaurants are crucial for many urban dwellers, including students and migrant workers. Despite these challenges, domestic demand remains a stabilizing factor for the sector.
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The LPG shortage is causing significant operational disruptions in restaurants, leading to potential job losses and reduced consumer spending, which could affect local economies.
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