Gujarat: 100 Morbi ceramic units shut as Iran war's fuel disruption hits sector

Nearly 100 ceramic manufacturing units in Gujarat’s Morbi district have shut down following a disruption in propane gas supplies linked to the ongoing conflict involving the United States, Israel and Iran, with industry representatives warning that hundreds more factories could suspend operations within days if the situation does not improve.

According to Morbi Ceramic Manufacturers Association (vitrified tiles division) president Manoj Arvadiya, around 100 units dependent on propane fuel have already halted production after supplies stopped over the past two days. “Due to the prevailing war-like situation, propane gas has not been available for the past two days, and around 100 units dependent on the fuel have already shut down,” Arvadiya told reporters.

He warned that the crisis could deepen if supplies are not restored soon, with nearly 400 additional propane-powered units facing potential closure within a week.

“If there is no proper guideline on gas availability and the supply does not normalise, we foresee that around 400 more propane-powered units may shut down by next week,” he said.

Morbi, located in Gujarat, is one of the world’s largest ceramic manufacturing hubs, housing hundreds of units that produce vitrified tiles and other ceramic products for both domestic and export markets.

Arvadiya said factories using gas supplied by Gujarat Gas were still operating for the moment, but their future too appeared uncertain given the limited availability of fuel. “Gujarat Gas customers are still operating as the resource is available to them at present. However, if we calculate based on the current availability, which is roughly around 50 per cent, even those units may face closure by 20 March,” he said.

The fuel disruption has also affected export commitments, with shipments getting delayed despite finished goods being ready. “The export orders that we had already produced are ready, but they cannot be dispatched. Many new export orders have also been put on hold,” Arvadiya said.

He added that the industry’s financial cycle could also be disrupted if shipments continue to be delayed. “In exports, payments are linked to shipment cycles. Once material is loaded and shipped, the next payment cycle begins. If shipments are delayed, our financial cycle will also get disturbed,” he said.

The situation has also raised concerns for thousands of workers employed in the sector. According to Arvadiya, most factories are currently retaining their workforce despite the shutdowns. “At present, labourers are still being retained. Contract workers are technically the responsibility of contractors, but in such situations we also try to extend help to them in whatever way possible,” he said.

The industry body has sought support from the state government if the crisis continues for a prolonged period.

Arvadiya said Gujarat chief minister Bhupendra Patel had expressed concern over the situation. “The chief minister recently spoke to (Tankara MLA) Durlabhji Dethariya and sought to know what assistance can be provided to the ceramic industry. We hope to meet the chief minister and seek relief if the crisis continues for a longer period,” he said.

Industry representatives had earlier warned that the Morbi ceramic sector could face a largescale shutdown if gas supplies from the Gulf region remained disrupted owing to geopolitical tensions affecting shipments passing through the Strait of Hormuz.

The disruption follows a sharp escalation in hostilities after the US and Israel launched military strikes on Iran on 28 February that killed Iran’s Supreme Leader Ayatollah Ali Khamenei.

Iran subsequently carried out retaliatory attacks targeting Israel and American military installations across the Gulf region, including in the United Arab Emirates, Bahrain, Kuwait, Jordan and Saudi Arabia, raising fears of wider disruptions to energy supplies and shipping routes in West Asia.

With PTI inputs