On May 3, 2026, India’s textile sector finds itself in turmoil—grappling with a critical shortage of natural gas and soaring costs, driven by ongoing geopolitical tensions.
The situation has escalated, with GAIL (India) Limited now relying on the spot market for gas. This shift has led to production costs skyrocketing. The government’s Natural Gas Control Order attempts to prioritize essential sectors, yet industrial buyers still face uncertainty regarding supply and exorbitant prices.
Currently, India consumes about 189 million MMSCMD of natural gas, importing over half of this volume. The ongoing conflict in key supply regions has severely disrupted global fuel trade routes, impacting India’s textile centers like Surat and Ferozepur.
As GAIL pays premium prices between $17-$20 MMBtu for urgent cargoes—compared to the usual $12-$15 MMBtu—manufacturers feel the pinch. Experts warn that this high cost is a significant burden for energy-dependent sectors like textiles.
Key statistics:
- Natural gas consumption in India: 189 million MMSCMD
- Percentage of allocation stability targeted by the government: 80%
- Percentage of crude oil imports through the Hormuz Strait: 40%
- Percentage of natural gas imports through the Hormuz Strait: 60%
- Percentage of LPG imports through the Hormuz Strait: 90%
The government aims to stabilize allocations for industrial consumers, but this strategy limits overall production capacity. As one official noted, “This high price indicates a significant burden for energy-intensive industries like textiles.” Meanwhile, another stated that India must aggressively diversify its energy resources.
The impact is palpable across the textile landscape, where manufacturers are bracing for tough times ahead. As they navigate these challenges, their resilience will be put to the test amid an uncertain future.
