Coimbatore MSMEs Face Production Crisis as Industrial LPG Shortage Hits 40% Output
A critical shortage of industrial LPG has plunged Micro, Small, and Medium Enterprises (MSMEs) in Coimbatore district into a severe operational crisis. Nearly 40% of production has come to a grinding halt, with turnover plummeting by approximately 30%, threatening the financial stability of thousands of businesses and workers.
Widespread Impact Across Key Sectors
M Karthikeyan, president of the Coimbatore District Small Industries Association (Codissia), revealed that the region is home to over 2.5 lakh MSMEs. These industries collectively consume around 1.2 lakh commercial LPG cylinders (19kg cylinders) every month. The distribution is as follows:
- 60,000 cylinders used by fabrication, laser cutting, powder coating, and textile processing units.
- 45,000 cylinders utilized by foundries and aluminium industries.
- 15,000 cylinders required by food processing units.
Karthikeyan emphasized that about 40% of industries have already been forced to reduce production due to the non-availability of LPG. He warned that the situation could deteriorate further once existing stocks are exhausted, potentially impacting thousands of workers and exacerbating economic losses.
Industry Leaders Sound Alarm on Escalating Crisis
I Shagul Hameed, state president of the Tamil Nadu Engineering Grill Manufacturers Association, reported that nearly 25% of production in fabrication units has stopped within just five days. Switching to electrical alternatives would cost about Rs 2.5 lakh per unit, a prohibitive expense for many small-scale operators.
According to Hameed, Tamil Nadu boasts more than 40,000 fabrication units, including around 4,000 in Coimbatore. Among these, nearly 1,000 small units are heavily dependent on LPG for critical heavy fabrication work, making them particularly vulnerable to supply disruptions.
Financial Strain and Production Cuts Intensify
N Devakumar Nagarajan, president of the Chinnavedampatti Industrial Association, highlighted the severe difficulties faced by powder coating and small manufacturing units in areas like Chinnavedampatti, Saravanampatti, Udayampalayam, and Vilankurichi due to inadequate LPG supply.
He noted that nearly 70% of powder coating units rely on gas furnaces. Compounding the problem, the price of a 19 kg LPG cylinder has skyrocketed from Rs 1,800 to Rs 4,500. This steep increase has forced many industries to cut production by around 40%. Several units that previously recorded turnovers of Rs 1 crore are now earning only about Rs 35 lakh, reflecting losses of 15–30%.
Urgent Calls for Government Intervention
Industry bodies are urgently appealing to authorities for immediate relief. Codissia has specifically requested the allotment of at least 30,000 commercial LPG cylinders to help industries meet their financial year-end production and dispatch commitments.
Karthikeyan pointed out that industries are already under pressure due to container shortages and rising freight charges for exports. The LPG shortage has further aggravated this precarious situation, putting the entire MSME ecosystem at risk.
Continuous LPG supply is deemed crucial for the survival of MSMEs, especially as many units are racing to complete year-end production targets. The collective plea from industry leaders underscores the need for swift governmental action to prevent a full-scale economic downturn in one of Tamil Nadu's key industrial hubs.
