A worker manually spray paints glasses inside a glass factory amid fuel supply disruptions following the U.S.-Israeli conflict with Iran, in Firozabad in the northern state of Uttar Pradesh, India, March 26, 2026. REUTERS/Bhawika Chhabra
| Photo Credit:
BHAWIKA CHHABRA
Famed as India’s “Glass City” with a four-century tradition of glassmaking,
Firozabad’s furnaces are now burning low, putting thousands of
day labourers out of work in what would normally be peak season.
The industry has been crippled by the war in the Middle East
because of its intense energy needs. Gas-fired heat chambers
need to run constantly at above 1,000 degrees Celsius (1,832
degrees Fahrenheit) to keep the glass molten and prevent
defects.
India’s heavy reliance on gas across the economy –
businesses of all sizes, households, agriculture, public
transport – makes its factories among the most vulnerable in
Asia.
New Delhi stockpiles oil but not gas, and when supply
dwindles, it cuts off industry first.
With the war extending into a second month, Firozabad may be
a harbinger of what is to come throughout Indian manufacturing,
from textiles to high tech, dealing a blow to India’s goal of
increasing manufacturing’s share of the economy to 25% from
around 17% currently.
HSBC’s India manufacturing flash PMI slumped to a
four-and-a-half-year low in March as the Middle East conflict
triggered instability in markets and uncertainty among
consumers.
SHUTTERED SHOPS AND IDLE LABOURERS
Just a short drive east of the Taj Mahal, Firozabad’s
glassmaking furnaces sit mostly apart from the colourful
marketplaces where tourists haggle over the city’s hallmark
glass bangles, which typically sell for about a dollar a dozen.
Jobless labourers loitered near the kilns they would
ordinarily be toiling over, scrolling on mobile phones.
Furnace operator Somesh Yadav said a unit that had employed
more than 500 workers until last month now had jobs for fewer
than 200.
Many smaller glass artisans had shuttered shop as they
waited for gas to become available, and affordable.
Some 200,000 people work in Firozabad’s glassware industry,
according to the Uttar Pradesh Glass Manufacturers’ Syndicate,
rising to about 500,000 when including indirect workers such as
vendors, sellers and suppliers of broken glass to factories.
“If the war drags on another month, our entire production
season could be wiped out,” said Rajkumar Mittal, an official at
the industry group.
The effect of the gas shortage isn’t linear. Furnace
operators say supply cuts of more than 20% since early March
have knocked output down by 40%.
CRISIS HITS AT PEAK SEASON FOR EXPORTS
India’s glassware exports were on pace to rise some 3% in
the financial year ended on March 31 from $4 billion in the
previous period, but shipments tumbled as much as 20% last
month, according to industry estimates.
Mukesh Kumar Bansal, a Firozabad manufacturer supplying
retailers in the U.S. and Europe, said output had dived by more
than a third at his factory.
“Usually from March to August we ramp up for Christmas and
Halloween orders,” he said. “This year, not a single container
has moved in March.”
That’s not solely the result of scarce gas and crimped
production. India – unlike Japan, South Korea and Taiwan –
depends on Gulf shipping routes to move its products, and those
routes have become prohibitively expensive as freight and
insurance costs spike.
Nomura economist Sonal Varma called India “one of the most
vulnerable countries in Asia to the blockade of the Strait of
Hormuz”, and manufacturers across industries spoke of
merchandise stranded in shipping containers at ports in Mumbai
and elsewhere.
Bansal said the price of shipping a 40-foot
(12.2-meter)container to Europe has soared more than 60% since
the war began, while exports to Gulf nations have stalled
completely.
CONTAINERS STRANDED AS FREIGHT COSTS SPIKE
The United Arab Emirates is India’s biggest export
destination after the U.S., taking mainly refined petroleum
products, jewellery and engineering goods, a category that
includes machinery, electrical equipment and auto parts.
The non-profit Association of Indian Entrepreneurs said that
some 17% of more than 20 million small manufacturing and
exporting units are facing sharp increases in energy, chemical
and transport costs that threaten their survival.
“Thousands of units may struggle if conditions do not
improve soon,” said K.E. Raghunathan, the association’s chair.
“Hundreds of thousands of workers may have already lost jobs.”
Textile manufacturers at the opposite end of the country to
Firozabad spoke of even steeper freight inflation.
Stiffenbabu Raju, managing director of Home Lines Textiles
in Karur, which exports about $5 million worth of goods annually
to Europe and the U.S., said charges for so-called high-cube
containers have climbed to about $4,000 from around $1,200 a
month ago.
As a result, his company’s shipments have fallen 20%.
“We have agreements with buyers, but they aren’t willing to
accept the new rates, so all shipments are suspended,” he said.
“Right now, we are just going to absorb losses so we can
keep our customers, and not think about profits.”
Published on April 2, 2026
