The ongoing shortage of commercial LPG supply has hit Hyderabad’s food outlets hard, with a few of them already ceasing operations. Representatives of restaurant and hotel bodies said that many small eateries and restaurants have been forced to cease operations, with migrant workers among their staff heading home amid the uncertainty facing the restaurant industry.
Sandeep Balasubramanian, head of the National Restaurant Association of India (NRAI)’s Hyderabad chapter, said that many restaurants are facing severe issues because of commercial LPG shortage.
“Most of them have already limited their menus leading to revenue losses. With restaurants looking at temporary or permanent closure, migrant staff members have also started to move back to their hometowns fearing long term loss of employment,” he said. Commercial LPG supply has come down by over 50%, Sandeep said.
Earlier on March 10, the Telangana State Hotels Association (TSHA) had warned that restaurants across Telangana may have to close temporarily if the commercial LPG shortage continues, urging the government to ease supply restrictions.
S Venkat Reddy, president of the Telangana State Hotel's Association (TSHA), said that they had planned a statewide shutdown at the time to build pressure, but held off after the Union government assured that it would increase commercial LPG allocations.
A 20% increase in commercial LPG allocation to states came into effect on March 23. However, this brings the overall allocation to only “50% of the pre-crisis level,” according to the Union Ministry of Petroleum and Natural Gas. The hiked allocation also comes with a push to transition to piped natural gas (PNG).
“Nearly 25% of restaurants have either ceased operations or are on the verge of doing so. If supply isn’t restored to normal levels soon, many more restaurants will find it unsustainable to keep running,” Venkat Reddy said.
Many smaller food outlets such as messes, curry points, tiffin centres etc. that run on commercial LPG and cater to low-income customers have also ceased operations intermittently.
Suman, who runs an outlet in Ameerpet serving breakfast foods such as idlis and dosas, pulled down his shutters on March 21. He said he was unsure when he would be able to reopen, as he was unable to source cylinders. Suman said that the commercial 19 kg cylinders that cost around Rs 2,000 are only available in the black market for as high as Rs 9,000 to 10,000.
Restaurants on food delivery platforms such as Swiggy too have started to display messages that they are temporarily unavailable because of the ongoing LPG shortage.
Venkat Narayana, who runs a curries and biryani shop in Yellareddyguda, said that the outlet was staying afloat by procuring cylinders from the black market. “We have hiked prices of all items by Rs 5 to keep up,” he said.
Sandeep said that even some of the restaurants that are part of the NRAI network are being forced to shut down. “Many outlets are on the verge of shutting down but trying to pull through a bit longer with woodfire etc. A lot of people don’t want to announce they are shut, because once they do, it affects public sentiment,” he said.
“The restaurant industry is fragile. Such adversities affect staff morale and customer sentiment. Once staff leaves, it’s difficult to get them back. And if word of mouth spreads that an outlet is shut, it could be difficult to get customers back too,” Sandeep said.
One advantage for Hyderabad, as Sandeep noted, is that the local foods such as biryani and haleem can be cooked on coal or wood fire. Many biryani outlets have switched to wood or charcoal, with some of them converting parking lots into a makeshift kitchen space, he said.
However, supply is not the only problem, as rising LPG prices have also put the restaurant industry under stress, according to Sandeep. “With the fear of job losses due to AI and inflation, people’s spending power is already going down. The LPG crisis has added to it, making it difficult for restaurants to survive,” he added.