LPG price hike: Restaurants warn of pricier menus, potential loss of jobs

Rising LPG prices threaten restaurants with menu changes and job losses, forcing many to increase prices or cut staff amid already high operational costs.

Food industry stakeholders warn that rising operational costs as a result of the jump in 19-kg commercial LPG cylinder prices could result in extensive menu changes and potential job losses.

Several restaurateurs also pointed to supply disruptions that have forced them to procure cylinders at significantly higher rates from the black market. (RAJ K RAJ /HT PHOTO)

Sandeep Goyale, the president of the Delhi chapter, National Restaurant Association of India, said, “The nearly 50% increase is definitely going to hit the industry hard.”

“We were expecting the hike, but this is too steep and may impact several restaurants who may have to increase prices to stay afloat. This may lead to the cost burden being passed on to consumers, though restaurants try to not do that as far as possible,” he said.

Restaurant owners said the increase is likely to have a cascading effect, particularly if fuel prices also rise, pushing up transportation costs for raw materials.

Manpreet Singh, owner of Zen restaurant in Connaught Place, said, “In that situation, most restaurants will have no option but to increase their food menu prices.”

Stakeholders in key commercial hubs said the shift to alternative fuel sources such as piped natural gas (PNG) is still gradual and cannot offset immediate pressures. Vikram Badhwar, general secretary of the Connaught Place Shopkeepers Association, said, “Although some people have started to get piped gas connections, the process will take time. Restaurants have already been working on cut down menus and not serving dishes which require a lot of gas, but this strategy cannot last in the long run and ultimately the gas price hikes will impact the customer.”

Several restaurateurs also pointed to supply disruptions that have forced them to procure cylinders at significantly higher rates from the black market.

Surjit Singh, 74, owner of Amar Jyoti restaurant in Sarojini Nagar, said, “Since it is such a steep rise, increasing the cost of our menu is something we will have to do. We had been operating on a reduced menu for a month, and only resumed making fried and steamed items from yesterday. During this period we have lost many customers and are worried we will lose more.”

The impact is also being felt on employment, particularly in smaller establishments catering to price-sensitive customers. An owner of a Kerala restaurant in INA market, requesting anonymity, said rising input costs had already forced business decisions.

“We had to close down our second branch in Ashram and had to let go of 5 to 6 staff members due to the rising gas costs. In our INA branch, we have been operating on a limited menu and have increased prices marginally, such as from ₹120 for a thali to ₹150, but have already lost customers as for our mainly working class customers, that price increase is also a lot. If we have to close this branch as well, my family and I will be fine, but our workers will face job loss,” he said.

Independent restaurant operators said they are particularly exposed due to limited financial buffers. Radhika Khandelwal, founder of Radish Hospitality and owner-chef at Trouble Trouble in Greater Kailash 2, said that they don’t have the scale or buffer that large chains do, so they end up absorbing both volatility in price and availability.

“This is happening at a time when we’re already dealing with high input costs across ingredients, labour and rent. Either we absorb the cost and operate on already thin margins, or we pass it on to customers, which risks affecting demand. Neither is sustainable in the long run,” she said.