LPG crisis: Borosil shuts Jaipur plant, sends home 3,000 workers

Borosil Ltd shares fell nearly 7% on March 12 after the glassware manufacturer disclosed that it had suspended production at its borosilicate glass furnace in Jaipur and scaled back operations at its opal glass furnaces due to an LPG supply cutoff linked to the Middle East conflict.

The company said in a stock exchange filing late on March 11 that oil marketing companies had restricted LPG supply citing force majeure arising from the ongoing war and its impact on global fuel availability.

The Jaipur plant, which requires between 13 and 20 tonnes of LPG per day to operate, had been without supply for two days before management shut it down on Wednesday, according to Rajasthan Patrika, which reported that roughly 3,000 contract workers were sent home.

Widening Industrial Crisis

Borosil's shutdown is one of the most visible corporate casualties of an energy squeeze that has rippled across Indian industry since Iran's blockade of the Strait of Hormuz disrupted shipping routes carrying roughly 90% of India's LPG imports.

India depends on imports for more than 60% of its total LPG consumption, according to CNBC TV18, leaving manufacturers, restaurants, and households exposed to supply shocks.

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The disruption has already forced petrochemical plants to halt operations. Hindustan Organic Chemicals Ltd shut down its propylene recovery unit on March 9 after continuous supply failures.

Ceramic manufacturers in the industrial hub of Morbi, Gujarat, warned they could face mass shutdowns by mid-March without restored gas flows, according to the BBC.

Auto component factories in Maharashtra's Chakan and Pimpri-Chinchwad industrial belts have also flagged imminent closures, with thousands of small enterprises at risk, Moneycontrol reported.

Government Response

The Indian government has sought to contain the crisis by boosting domestic LPG production by 10% and directing all refineries to operate at full capacity, according to NDTV.

Officials said procurement from routes bypassing the Strait of Hormuz had been raised from 55% to 70%. However, the government has simultaneously prioritized household cooking gas over commercial and industrial users under the Essential Commodities Act, leaving businesses to absorb the brunt of supply cuts.

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Borosil said it is coordinating with oil marketing companies and government authorities to secure LPG supplies and restore production. The company, which had its board approve a ₹92 crore manufacturing expansion just days before the shutdown, said it is still assessing the full financial impact of the disruption.

Mahendra Singh, general manager at the Borosil plant, told Rajasthan Patrika that staff layoffs could follow if supplies are not restored soon. "Once the supply resumes, only then can the plant restart," he said.