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Kerala hotels plan shutdown against cooking gas price hike
January 2, 2014, 3:04 pm

An unexpected steep hike in cooking gas price has prompted the hotel and restaurant sector in Kerala to observe a day of protest on Friday, by downing its shutters.

The Kerala Hotel and Restaurant Association said its member establishments would remain shut from 6am to 6pm on Friday. The association said the latest decision by the federal government to increase cooking gas price meant a steep rise in operating costs for hoteliers and that it was not feasible to pass on the entire burden to customers.

Following the latest price hike, the cost of domestic gas cylinders is pegged at Rs1,293.50 (Dh76.64), representing an increase of Rs230.50 per cylinder. Commercial cylinders now cost Rs2,184 each, after a hike of Rs385.94 per cylinder.

The state government moved quickly to soften the blow for consumers, by opting to forgo some of the taxes in the revised cost.

Chief minister Oommen Chandy said the government would forgo value added tax on the increase in price of cooking gas.

While the price hike has been blamed on the Congress-led United Progressive Alliance government in Delhi, the Congress-led government in Kerala has said there was “no justification” for a hike in cooking gas prices, which increased the burden on the common man.

Chief minister Chandy said he had conveyed his protest over the gas price hike to Veerappa Moily, the federal minister for petroleum and natural gas.

For the hotel industry, the price hike for cooking gas is a bitter blow, coming as it does amid a severe inflation in price of vegetables, fish and meat, which have all contributed to squeezing their margins.

Hoteliers have over the past several months passed on a portion of the impact of price hikes to their customers, but they fear any further hike in their menu pricing would be a turn-off for those eating out.


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