LPG Price Hike: Why Hotels and Restaurants Are Feeling the Heat

LPG Price Hike: Why Hotels and Restaurants Are Feeling the Heat

By Manu Vardhan Kannan

Published on October 2, 2026

The latest commercial LPG price hike has added another cost pressure for India’s food-service and hospitality sector, coming just as hotels, restaurants, caterers and other food businesses prepare for the festive season. From October 1, 2026, the price of a 19-kg commercial LPG cylinder increased across several cities, with Delhi seeing a ₹62.50 rise to ₹2,810. Chennai’s price has moved up to ₹2,983, while the increase varies across cities. Domestic LPG prices, meanwhile, remain unchanged. 

The October revision follows a ₹9.50 increase in September, when the Delhi price moved to ₹2,747.50. The latest increase therefore comes at a time when commercial kitchens are already preparing for higher festive-season activity. 

For the hospitality industry, LPG is a daily operating requirement across restaurants, hotel kitchens, bakeries, caterers, cloud kitchens, canteens and smaller food outlets. Even a relatively small increase per cylinder can become meaningful for businesses that use several cylinders every week or month.

Why Commercial LPG Prices Are Rising

The increase is linked to a combination of international LPG prices, supply conditions, freight costs, currency movements and the wider energy market. India imports around 60% of its LPG requirement, making the country sensitive to movements in international markets. Earlier in 2026, the disruption to shipping through the Strait of Hormuz sharply affected LPG flows into India. Reuters reported in March that India's LPG imports were expected to fall by 46% month-on-month, while the share of Gulf exporters in India's imports had declined as alternative supplies were sought. 

The West Asia conflict has therefore been an important factor in the LPG supply situation. Disruptions around the Strait of Hormuz affected shipments from major Gulf suppliers and pushed India to look for cargoes from the United States, Russia, Argentina and other markets. Longer shipping routes and tighter global availability can add to the landed cost of LPG.

However, the October 1 price revision should not be attributed entirely to the conflict. International LPG benchmarks, freight, currency movements and other market factors also influence commercial LPG prices. Saudi Aramco, for example, raised its October LPG official selling prices amid higher global oil prices and demand, providing another indication of the international market pressure facing LPG buyers.  India is also working to diversify its LPG supplies. State-owned LPG importers recently issued a tender seeking around 2.75 million metric tonnes of LPG from the United States for delivery in 2027, showing the country's effort to broaden its sourcing base. 

Small Food Businesses Face a Different Kind of Pressure

For roadside food stalls, tea shops and small eateries, the increase can have a more direct impact on margins. These businesses generally operate with limited cash reserves and depend heavily on LPG for boiling, frying, steaming and bulk cooking. At the same time, their customers are often highly price-sensitive, making it difficult to immediately increase menu prices.

For example, a business using two cylinders a week would face an additional cylinder-cost burden of roughly ₹500 a month from a ₹62.50 increase, before considering any delivery or supply-related costs. Some operators may respond by adjusting menus, reducing operating hours, changing production schedules or using alternatives such as induction where practical. Passing the entire increase to customers, however, may not always be possible.

Restaurants and Cloud Kitchens

Restaurants and cloud kitchens face a broader cost equation. LPG is only one part of their operating expenses, alongside vegetables, edible oil, packaging, labour, rent and delivery-related costs. High-volume kitchens can feel the impact more sharply because cooking continues throughout the day. Caterers and banquet kitchens may face an additional challenge when events have already been priced or contracted before the LPG revision.

Restaurants may therefore look at selective menu-price adjustments rather than increasing prices across every dish. Menu engineering, better production planning, bulk procurement and greater use of energy-efficient equipment can also help reduce the impact.

Large Hotels Have More Options

Large hotels generally have more ways to manage short-term fuel-cost fluctuations because their revenues come from multiple segments, including rooms, restaurants, banquets, events and other services.

Energy audits can help hotels track LPG consumption outlet by outlet and identify areas where fuel use can be reduced. Centralised preparation of sauces, stocks, breads and semi-finished products can also prevent duplication across multiple kitchens. Hotels may also consider induction cooking, electric ovens, efficient burners, heat-recovery systems or piped natural gas where infrastructure and safety requirements allow.

Menu engineering can play another role. Hotels can promote dishes with stronger contribution margins, improve batch production and reduce food waste while maintaining the expected guest experience. For banquets and large events, gradual pricing adjustments may be considered instead of applying a separate and noticeable fuel surcharge to customers.

The Bigger Impact on Hospitality

The absolute increase may appear small when viewed against the cost of a single cylinder. The larger concern for hospitality businesses is the cumulative effect of repeated cost increases. A kitchen using 20 cylinders a month would spend ₹1,250 more from a ₹62.50 increase per cylinder. A 100-cylinder operation would see an additional ₹6,250 before accounting for any other changes in logistics or supply costs.

For large hotels, these amounts can be distributed across several business divisions. For a small restaurant or food stall working on thin margins, the same increase can have a more immediate effect on profitability. This difference is important for understanding how the LPG hike may affect the hospitality sector. The same per-cylinder increase does not create the same business impact for every operator.

What Happens Next?

The direction of commercial LPG prices will depend partly on international supply conditions and the wider energy market. India's efforts to diversify LPG sourcing could provide greater supply flexibility, but alternative cargoes can involve longer transportation distances and different freight economics. Reuters reported that India is already seeking larger long-term supplies from the United States for 2027. 

In the short term, hotels, restaurants and caterers are entering a period when demand can increase because of festivals, weddings and other events. That makes fuel efficiency more important even if LPG prices do not rise again.

For the hospitality industry, the October hike is therefore more than a monthly price revision. It is another reminder of how closely commercial kitchens are connected to international energy markets. From a roadside tea stall to a five-star hotel kitchen, businesses will have to balance fuel costs, menu pricing, operational efficiency and customer expectations as the festive season gets underway.


India Exports Makhana, So Why Is It Still So Expensive at Home?

India Exports Makhana, So Why Is It Still So Expensive at Home?

By Hariharan U

Published on October 22, 2026

India’s makhana industry is gaining international traction, but a question remains for domestic consumers: why does a traditional Indian food often carry a premium price tag in the very country that produces most of it?

India exported 7,264.89 metric tonnes of makhana and makhana products in FY 2025–26, valued at approximately ₹192.96 crore, according to government data. With demand expanding across international markets, the opportunity extends beyond exporting the raw product to developing branded snacks and other value-added foods. 

Why does makhana cost so much?

Unlike many conventional crops, makhana requires labour-intensive harvesting and specialised processing. Its seeds are collected from ponds or cultivated fields, cleaned, dried, roasted and popped through a process that has traditionally depended on skilled workers. The seeds also undergo multiple stages of handling before becoming the white, puffed product consumers recognise.

Research by the Indian Council of Agricultural Research has highlighted the demanding nature of this process, while value-chain studies identify processing, grading, packaging, transportation and intermediary margins as contributors to the final retail price. The conversion from raw seed to popped makhana also means that considerably more raw material is needed to produce a kilogram of the finished product.

Premium packaging and branding add another layer to the price. As makhana enters organised retail and health-focused snack categories, flavoured varieties, smaller consumer packs, marketing and distribution can increase what shoppers pay. However, the extent of each cost depends on the product, quality and route to market.

Rising demand is another factor. Government data indicates that average makhana prices increased from around ₹500 per kilogram in 2020–22 to nearly ₹1,250 in 2025, while production grew by only 4–5% between FY 2021–22 and FY 2024–25. This points to a supply response that has struggled to keep pace with growing demand.

The opportunity lies beyond raw exports

India’s next challenge is to capture more value from its production advantage. Selling bulk makhana can open international markets, but processing, flavour development, quality standardisation and branding can create additional revenue opportunities for Indian businesses.

A July 2026 shipment of value-added flavoured makhana from Bihar to Canada demonstrated this potential. According to the government, the initiative enabled associated farmers to realise over 50% higher returns through value addition and improved market access. 

Yet, value addition must extend beyond the retail shelf. Better processing infrastructure, improved productivity, stronger farmer-producer organisations and more direct links between growers, processors and buyers could help distribute the gains more widely.

For consumers, the question is not simply whether makhana is worth its price, but what that price represents. For the industry, the bigger opportunity is to build a value chain in which export growth, product innovation and better farmer returns progress


Chennai and Kolkata Airports May Go Private: Weighing the Pros and Cons

Chennai and Kolkata Airports May Go Private: Weighing the Pros and Cons

By Manu Vardhan Kannan

Published on October 22, 2026

The government of India is considering handing over Chennai and Kolkata airports to private companies under the Public-Private Partnership (PPP) model through long-term leases. The proposed move aims to upgrade airport infrastructure, improve passenger services and bring operations closer to international standards. The Union Ministry of Civil Aviation is examining the proposal, which could add the two airports to the list of major Indian airports managed by private operators, including Delhi, Mumbai, Bengaluru and Hyderabad.

Under the proposed arrangement, private companies would manage day-to-day operations, shops, restaurants and infrastructure development. However, air traffic control and security would remain under the direct control of the Centre, according to sources in Delhi.

The proposal comes amid growing calls for improved airport infrastructure and passenger services. The Tamil Nadu government has long pushed for better service quality, improved passenger facilities, increased air traffic capacity and stronger cargo handling capabilities at Chennai Airport.

What Could Change for Passengers?

Private participation could bring fresh investment, improved terminal facilities and more efficient airport operations. Passengers could benefit from better seating, cleaner washrooms, upgraded baggage systems, improved food and retail options, and faster check-in and security processes.

For Chennai Airport, additional infrastructure capacity could also help address operational bottlenecks and improve passenger movement. Better cargo facilities and airside infrastructure could support the airport's ability to handle growing traffic. However, these improvements are not guaranteed. The overall benefits would depend on the investment commitments, operational standards and service requirements included in the final agreement.

Will Airport Charges and Retail Prices Increase?

One of the major concerns surrounding airport privatisation is its potential impact on passenger expenses. Airport charges, including the User Development Fee (UDF), are subject to regulatory oversight, while airport-related costs can also influence airline operating expenses and, in turn, ticket prices.

Private operators may also look to increase revenue through restaurants, cafés, retail outlets, parking and other commercial services. While this could introduce more brands and improve the shopping and dining experience, higher commercial rents and concession fees could push up prices for passengers.

The impact on businesses operating inside the airports could also vary. Established brands may benefit from better retail spaces and increased passenger spending, while local food businesses and smaller retailers could face challenges if rents and contract terms favour larger operators.

Balancing Investment with Passenger Interests

The success of the proposed PPP model will depend on how effectively passenger interests are protected alongside commercial objectives. Clear service standards, transparent airport charges, reasonable prices for essential food and travel items, and regular passenger satisfaction reviews could help ensure that infrastructure improvements translate into real benefits. Providing opportunities for local food brands, retailers and cultural businesses could also help Chennai Airport showcase Tamil Nadu's identity while supporting smaller enterprises.

Ultimately, private participation could improve Chennai and Kolkata airports, but better facilities should not come at an unreasonable cost to travellers. The key test will be whether passengers experience shorter queues, improved services and better infrastructure without facing disproportionate increases in airport fees and retail prices.


Dammam Airport Attack Raises Fresh Concerns Over Saudi Air Travel

Dammam Airport Attack Raises Fresh Concerns Over Saudi Air Travel

By Manu Vardhan Kannan

Published on October 22, 2026

An attack targeting King Fahd International Airport in Dammam, Saudi Arabia, on Wednesday evening, October 21, killed one person and injured eight others, according to the country's General Authority of Civil Aviation. The injured were taken to hospital, with their conditions ranging from minor to serious. Authorities are also assessing the material damage caused by the incident.

The attack comes amid a growing wave of security incidents affecting Saudi Arabia's airports and critical infrastructure. While the country's airports have faced repeated attacks linked to Yemen's Iran-backed Houthi rebels, Saudi authorities have not confirmed who was responsible for the latest Dammam incident.

The escalating situation has raised concerns about airport safety, airline operations and passenger travel across the region. Flights have been diverted away from Dammam following the attack, while Riyadh's King Khalid International Airport has faced repeated strikes and restrictions on flight operations. Saudi Arabia has faced comparable Houthi attacks before, especially during the Yemen war from 2015 onward. The current wave is more severe because it has repeatedly hit major civilian airports, caused mass casualties, and shut Riyadh’s main airport.

Flight Disruptions Affect Indian Travellers

The security situation has also affected travel between India and Saudi Arabia, particularly for people travelling for Umrah. Flight cancellations, diversions and schedule changes have left some pilgrims facing delays, longer journeys and additional expenses.

As of October 22, Air India, Air India Express and IndiGo had suspended services on affected Saudi routes until October 24, while Akasa Air's suspension was extended until October 27. These dates are subject to further airline updates as the situation develops.

According to advisories from Indian authorities, airports in Dammam, Jeddah and Madinah continue to operate, although disruptions remain. Saudia is operating scheduled services from Dammam, Jeddah and Madinah, while some travellers requiring urgent departure may explore alternative routes through neighbouring countries, subject to visa requirements and flight availability.

For Umrah pilgrims, the main concern is reaching the holy cities and returning home safely. Although Jeddah and Madinah remain operational, flight changes and cancellations can affect travel plans at short notice.

Indian Authorities Issue Safety Advisory

The Indian Embassy in Riyadh has urged Indian nationals to follow instructions issued by local authorities and remain alert to security developments. Citizens have also been advised to stay indoors and move to the nearest safe shelter if an aerial attack or alert occurs.

Indian travellers have been asked to remain in contact with their airlines and travel agents, confirm flight status before leaving for the airport and prepare for possible changes to their journeys. The Indian government has also arranged assistance for citizens affected by the disruptions, including Umrah pilgrims.

The United States has separately ordered non-emergency embassy employees and eligible family members to leave Saudi Arabia amid the rising security risks.

As the situation continues to develop, the latest attack highlights the challenges facing Saudi Arabia's aviation sector. For airlines, passengers and the travel industry, maintaining safe operations and providing timely updates will remain essential as authorities respond to the ongoing security concerns.

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