The geopolitics of the Middle East have once again exposed the fragile underpinnings of the Indian economic miracle. As the conflict in the Strait of Hormuz chokes the global supply of Liquified Petroleum Gas, India finds itself in a familiar, desperate scramble that reveals the shallow depth of our energy security. For all the talk of being a rising global power, we remain a nation whose daily survival is tethered to a single, volatile maritime corridor. The recent decision by the government to prioritise domestic LPG connections while effectively starving the hotel and restaurant industry is not merely a tactical manoeuvre; it is a manifestation of a systemic shortsightedness that borders on the medieval.
India’s dependency on LPG is a ticking time bomb that we have ignored in favour of easier, shorter-term gains. In 2026, we find ourselves importing nearly 90 per cent of our LPG requirements, with the vast majority of these shipments passing through the Strait of Hormuz. When the Iran-Israel-US conflict escalated, the impact on our supply chain was instantaneous. Suppliers invoked force majeure, and the government, caught off guard despite decades of warnings, retreated into its default mode: rationing. By invoking the Essential Commodities Act and the Natural Gas Supply Regulation Order of 2026, the state has decided that the commercial sector is a luxury we can afford to discard.
The math of this diversion is staggering in its cruelty. The hotel and restaurant industry, alongside the myriad roadside dhabas and eateries that dot our highways, provides a lifeline for an estimated 13 crore people. The vast majority of these workers exist in the unorganised sector, a term we use conveniently to mask a lack of social security and institutional protection. These are the cooks, the cleaners, and the helpers who have migrated from rural distress to urban hope. In Kerala alone, reports indicate that over 1,200 eateries have downed their shutters in the last two weeks. In Mumbai, nearly 20 per cent of hotel operations have ground to a halt. When these kitchens go cold, the workers don’t just lose a shift; they lose their place in the city. We are witnessing a silent, internal deportation where thousands of workers are being forced back to their villages.
The ripple effect extends into the modern digital landscape that we so proudly showcase to the world. The gig economy, often touted as the future of Indian labour, is currently in a state of freefall. Over 1.2 crore delivery partners, the backbone of platforms like Zomato and Swiggy, have seen their daily orders drop by as much as 60 per cent. A delivery worker who once managed 30 orders a day is now struggling to find five. This is the reality of our “Atmanirbhar” youth—partners in name, but victims in practice. By cutting off the commercial gas pipeline, the government is not just inconveniencing the diner; it is dismantling the income of the youth it promised to empower. It is a policy that ensures unemployment while claiming to protect the household hearth.
The logic offered for this crisis is that domestic households must be protected because cooking fuel is a basic right. While this sounds noble on a campaign poster, it is economically illiterate. A household has alternatives; many urban homes are equipped with induction cookers, and in rural areas, traditional fuels still linger as a fallback. However, a commercial kitchen is a specialised machine. You cannot run a dhaba or a medium-sized restaurant on a domestic induction plate. By prioritising the domestic cylinder as a political tool, the state is ensuring that while the home stove might stay lit, the kitchen where the breadwinner earns his wage remains empty. We are trading the long-term viability of our service sector for a short-term political win, a choice that will inevitably lead to a slowdown in India’s overall growth.
This crisis is entirely avoidable, which makes the current situation even more tragic. India receives enough solar energy to power the planet several times over, yet we remain enslaved to the volatile oil markets of the Gulf. The solution to our LPG dependency is not just more tankers or strategic reserves, but a radical decentralisation of power. We should have been a nation of energy prosumers by now, where every rooftop is a power plant. The technology for peer-to-peer energy trading—allowing a housing society or a village panchayat to generate solar power and sell the excess to the local dhaba—is no longer a futuristic dream. In countries like Germany and the Netherlands, such decentralised cooperatives are already stabilising the grid and providing energy independence.
In India, however, this common-sense approach is treated as a crime. Our archaic electricity distribution laws are designed to protect the monopolies of state-run distribution companies and a few private giants. These entities guard their distribution rights with a ferocity that stifles any attempt at local energy democracy. Even as the Delhi Electricity Regulatory Commission initiates small-scale pilots for peer-to-peer solar trading in early 2026, the regulatory hurdles remain immense. The government’s refusal to break the “Distribution Raj” is the primary reason why we are still holding our breath every time a tanker is delayed in the Persian Gulf. We are a country rich in sunshine and wind, yet we choose to remain beggars at the gates of global oil markets.
The current policy of starving the hospitality sector to feed the domestic subsidy is a symptom of a deeper malaise. It reflects a mindset that views the economy as a series of disconnected silos rather than an integrated ecosystem. You cannot protect the consumer while killing the provider. You cannot celebrate a “booming” gig economy while cutting off the energy required to sustain it. The state’s insistence on monopolising energy distribution while failing to manage the supply chain is a dual failure that punishes the entrepreneur and the labourer alike.
We are essentially burning the barn to keep a single candle lit in the window. By the time the powers-that-be realise that a nation cannot survive on subsidised tea while its commercial kitchens are cold and its youth are retreating to the villages, the damage will be irreversible. We don’t need another bureaucratic committee to study fuel shortages; we need to liberate the sun from the clutches of licensing. If we continue to criminalise the sale of excess solar energy while begging for gas from war zones, we aren’t just facing an energy crisis—we are facing intellectual bankruptcy. The stove is out, the delivery bikes are silent, and the economy is being served cold on a plate of political arrogance. The question is no longer when the gas will return, but when the vision will arrive.