MSMEs in Bengaluru on edge amid LPG crunch

Bengaluru's MSMEs face severe risks from the LPG supply crunch, threatening production, costs, and employment across industries.

Micro, small, and medium industries in Bengaluru are increasingly growing concerned about the ongoing LPG supply crunch and rising prices due to tensions in West Asia.

Many of them rely on LPG and industrial gases for foundry and casting operations, heat treatment processes, powder coating, engineering fabrication and welding, food processing, and chemical and pharmaceutical manufacturing. 

Potential disruptions could lead not only to production slowdown but can have cascading impact leading to supply chain disruptions for larger industries, increase in manufacturing costs, slowdown in exports, and even worker layoffs. 

Shiva Kumar R., immediate past president at Peenya Industries Association, fears that the industry is looking at the situation as grave as the oxygen cylinder unavailability during COVID. “The industrial units might face possible disruption or delay in LPG cylinder supply, operational disruptions in furnace-based industries, and working capital stress, especially for micro entrepreneurs,” he said.

According to him, for many micro and small units, energy costs account for nearly 15–30% of production expenses. Any increase in LPG prices or supply disruptions directly impacts production and business sustainability.

“Given that Peenya alone generates industrial turnover of about ₹35,000 crore annually, any disruption in production can significantly affect local economic activity, supply chains, and employment in Bengaluru and Karnataka,” Mr. Shiva Kumar added.