Fuel Crisis Threatens Morbi Ceramic Hub Amid Middle East Conflict

The ongoing Iran-US-Israel conflict has caused a major disruption to critical gas and propane supplies, which puts at risk the operations of more than 600 ceramic manufacturing units in Gujarat, which employ over 4 Lakh workers.

Morbi’s Ceramic Cluster Faces Fuel Supply Shortage

Morbi in Gujarat is one of the world’s largest ceramic tile manufacturing hubs. It supplies tiles across India and global markets. The industry depends heavily on propane and natural gas, mainly imported from Gulf Cooperation Council nations, to run its kilns and drying processes.

Around 40% of India’s crude oil imports arrive through the Strait of Hormuz. The current geopolitical tensions in the Middle East are causing supply delays from key Gulf exporters and leading to serious shortages for manufacturers in the region.

Reports suggest the fuel stocks are dangerously low. Propane inventories at many units can last only two to three days, while natural gas reserves supplied by Gujarat Gas Ltd are expected to sustain production for about one week to ten days based on current estimates.

In fact, Gujarat Gas has informed customers of a 50% reduction in daily gas supply to industrial users from March 6 through March 31 due to the tight availability of imported LNG. This further heightens the risk of production halts.

What May Happen Next?

Morbi’s ceramic tile industry may face a shutdown within the next few days if the gas and propane supply is not restored quickly.

Manufacturers also anticipate a sharp rise in fuel prices when supplies resume, which may further reduce margins and their competitiveness. The higher cost of propane and natural gas would inflate manufacturing costs, leading to higher tile prices and deeper financial stress on producers.

Employment And Local Economy At Stake

The sector directly and indirectly employs more than 4 lakh workers, including factory labourers, transporters, traders, packaging units, and support service providers. Together, they are a vital source of income and economic activity for the region. If the disruption continues, it could cause widespread job losses and negatively impact the local economy. Furthermore, the workers could face weeks without income.

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Looking Ahead: Risks And Possible Mitigation

Manufacturers are now asking the government for quick help. They want support in finding alternative fuel supplies, faster logistics, or some kind of relief so factories can keep running. Some suggestions from industry experts include increasing India's own gas production and building better pipeline networks so that the dependency on imported fuel can be reduced in the future.

Right now, the situation in Morbi is still tense. Gas supplies are running low, and there is no clear solution yet. Because of this, the ceramic industry in Gujarat is facing one of its toughest supply problems in recent years, mainly due to a global conflict happening far away.

Sources:

NDTV

ET

News Kerala