Coimbatore Businesses Grapple with Illegal LPG Sales as Prices Skyrocket to Rs 7,000
Traders and industrial stakeholders in Coimbatore district are confronting severe operational challenges due to the illegal sale of commercial LPG cylinders at exorbitant prices, with reports indicating costs as high as Rs 7,000. This surge in the black market has exacerbated the financial burden on businesses already struggling with rising input costs.
Supply Crunch Drives Unprecedented Price Hikes
Amid a significant supply crunch, the price of commercial LPG cylinders in the parallel market has escalated sharply, reaching unprecedented levels. Small eatery owners, in particular, are facing dire circumstances as timely refills are unavailable, compelling them to purchase cylinders at inflated prices from the open market. In some areas, middlemen are supplying cylinders for a commission, further distorting the market.
S Lingam, district secretary of the Tamil Nadu Vanigar Sangangalin Peravai, highlighted the scale of the issue, noting that more than 20,000 small grocery stores, restaurants, and bakeries operate in the district, all affected by this crisis.
Impact on Local Businesses and Migrant Workers
Chandran of Avarampalayam, an eatery owner, shared his plight, stating that he requires two commercial gas cylinders every two days. Due to shortages, he is forced to procure them from the outskirts at prices ranging from Rs 5,500 to Rs 7,000, significantly raising his operational costs.
Migrant workers in Periyanaickenpalayam are also feeling the pinch, relying on 5 kg domestic cylinders that cost Rs 638, with prices nearly doubled in some instances. The gas shortage has led to increased prices of food items such as parotta, chapati, and dosa, affecting both consumers and vendors.
Industrial Sector Faces Severe Disruptions
N Mathivanan, president of the Coimbatore SIDCO Industrial Estate Manufacturers Welfare Association (COSIEMA), provided alarming insights. He reported that 19kg commercial gas cylinders, previously sold at around Rs 1,850, are now being sold in the open market for Rs 3,500 to Rs 5,000, and currently as high as Rs 7,000.
Mathivanan pointed out that 33 kg and 47 kg cylinders have not been available for the past few days, severely impacting industrial operations. Supplies to industries are inadequate, affecting critical sectors such as powder coating and fabrication.
In the parallel market, cylinders are reportedly supplied only to regular buyers, while new customers face significant hurdles in obtaining them. This shortage has forced canteens in factories to halt full operations, adding to the operational woes of industrial units.
Official Response and Ongoing Challenges
Indian Oil Corporation officials have stated that domestic cylinders are being supplied regularly. They are also taking steps to prevent the illegal sale of gas cylinders at higher prices. However, the persistent supply issues and rampant black market activities continue to pose a significant challenge for Coimbatore's business community.
The sharp rise in LPG prices has come as a shock to many industrial units, underscoring the urgent need for effective measures to stabilize supply and curb illegal practices. As businesses navigate this crisis, the broader economic implications for the region remain a concern.
