US-Iran standoff leaves industry in the hot seat

Ludhiana: The window of hope that had briefly opened with the possibility of talks between the United States and Iran appears to have shut again after discussions failed to yield a breakthrough. Industry, already reeling under disrupted supplies, LPG scarcity, rising fuel prices, and increasing costs of raw materials, is once again gripped by uncertainty and fear. Manufacturers say that just when they had begun expecting relief in logistics, fuel availability, and pricing stability, the failed talks created fresh uncertainty. Upkar Singh Ahuja, president of the Chamber of Industrial and Commercial Undertakings (CICU), said there is widespread uncertainty as stakeholders were hoping the situation would begin to normalize."Supply of LPG was also expected to stabilize, but now the industry is again in a state of fear," he said. He added that energy costs have risen sharply, while exports have slowed and raw material prices remain volatile. "Industry is currently operating at a loss just to keep the cycle going. Many units are continuing production only to retain labor and maintain customer relationships, with the hope that mediation efforts resume," he said. He noted that uncertainty in fuel and raw material supply makes production planning difficult, especially for MSMEs working on thin margins. Badish Jindal, president of the World MSME Forum, said costs had softened briefly, but uncertainty returned as talks failed. He warned that metal and raw material prices are expected to increase further if tensions continue. "Steel prices have already increased by about Rs 5,000 per tonne in a month. Earlier, there was some correction during the possibility of talks, but now the fear is that prices will shoot up again. Those who have already taken orders will have to bear losses," he said. He added that MSMEs are worst affected as they cannot frequently revise prices. "Large buyers resist revisions, but raw material costs change almost every week. This mismatch puts pressure on working capital and profitability," he said. Saravjit Singh Minhas, co-convener of the export committee of CICU, said exporters are facing confusion and uncertainty. "We are totally in the dark. It is being said that steel prices are going to climb further. Whether to purchase raw material or commit to exports, everything is uncertain," he said. He added that fluctuating prices create a major dilemma. "When we book an order, the raw material price is different, but at the time of dispatch, the price is revised. This makes costing extremely difficult. That is why we are not booking any large orders at this point," he said. Exporters risk losses if they commit at current rates and input costs rise later. "Unless there is stability in fuel, logistics, and raw material, industry will continue to operate cautiously," he said, adding that manufacturers hope for renewed diplomatic efforts to restore stability.
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