Iran conflict: Nearly 100 ceramic units in Gujarat's Morbi shut due to fuel supply disruption

Morbi: Nearly 100 ceramic manufacturing units have shut down in Gujarat's Morbi district following a disruption in fuel supplies linked to the US-Israel-Iran war, with industry representatives warning that another 400 factories may close within days if the supply doesn't normalise.

Manoj Arvadiya, president of the Morbi Ceramic Manufacturers Association (Vitrified Tiles Division), said the situation could worsen in the coming days if propane supplies are not restored and suppliers fail to issue clear guidelines.

"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 nearly 400 more units that use propane may be forced to halt operations within a week if the supply situation does not improve.

"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 is one of the largest ceramic manufacturing hubs in the world, housing hundreds of units that make tiles and other ceramic products for domestic and international markets.

Arvadiya said units that depend on gas supplied by Gujarat Gas were currently operating, but their future also appeared uncertain due to the limited availability.

"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 March 20," he said.

The disruption in fuel supply has also affected export commitments, he said.

Arvadiya said, "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."

The disruption could also affect the financial cycle of the industry, which relies heavily on the timely shipment of export consignments, he added.

"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 is also grave for workers employed in the sector. Arvadiya said factories are retaining most labourers despite the crisis.

"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 also 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 large-scale shutdown if gas supplies from the Gulf region remained disrupted due to the geopolitical tensions affecting shipments passing through the Strait of Hormuz.

The US and Israel launched military strikes on Iran on February 28, killing Iranian Supreme Leader Ayatollah Ali Khamenei.

Following the military offensive, Iran carried out a wave of attacks mainly targeting Israel and American military bases in several Gulf countries, including the UAE, Bahrain, Kuwait, Jordan and Saudi Arabia.