Bengaluru hotels eye 10% price hike as commercial LPG costs surge; 19kg cylinder now costs Rs 3,153

BENGALURU: Eating out is set to become costlier, with the Union ministry of petroleum and natural gas raising commercial LPG prices by a steep Rs 991 from Friday.

A 19 kg commercial cylinder will now cost Rs 3,153 in Bengaluru — up by Rs 993.

Speaking to TOI, Bengaluru Hoteliers' Association president P C Rao said restaurant owners were left with no option but to increase prices of items on the menu by 10%.





Hoteliers noted that commercial LPG prices were increased thrice in the last 60 days, with the total hike amounting to Rs 1,388.

Restaurant owners in the city voiced their concern, saying a combination of factors is creating strong headwinds for the hospitality sector, putting its future in jeopardy.

According to National Restaurant Association of India (NRAI), commercial LPG currently accounts for about 10% of food cost at restaurants. This could rise to 12-15%, following the latest price hike. NRAI president Sagar Daryani told TOI: "The exact impact will depend on the extent to which prices stabilise over the next few weeks," he told TOI.

Several restaurants are now evaluating a gradual shift towards induction-based cooking systems to reduce dependence on LPG, although this will require additional investments in power infrastructure and take time to implement.

Ramehwaram Cafe co-founder Raghavendra Rao said LPG currently accounts for about 4-5% of overall operating costs, which could now rise to 6-7%.

Cascading Effect
Bengaluru has around 30,000 hotels. The impact of the hike on small eateries will be severe, hoteliers warned.

Terming the hike abnormal, P C Rao said: "As soon as the elections were over, the govt gave us a big blow. It may think commercial cylinder prices do not impact the common man directly, but it will certainly have a cascading effect. This move will also affect hostels, PGs and canteens. Increasing prices of food items is not our intention, but it is unavoidable."

He added that the association will send a representation to the Centre, seeking a reduction in GST on commercial LPG from 18% to 5% as a relief measure.

Unviable Alternatives
BHA secretary Veerendra Kamat said even as hoteliers were looking for alternative fuel sources, most were not practical. "The electricity tariff was increased in April. We are also required to pay arrears in power tariffs from March 2024 to April 2026, which may run into lakhs. Switching to solar power is impossible as most restaurants operate from rented premises," he said.

Even though shifting to piped gas is an option, pipelines have not yet been laid in Bengaluru's Central Business District, he added.
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