Indian Oil Corporation has revised the price of industrial diesel to Rs. 109.59 (US $1.18) per litre, a sharp increase from Rs. 87.67 (US $0.94) per litre, a 25% hike. The revised rates are understood to have come into effect from 20th March 2026.
Industrial diesel, unlike retail fuel, is supplied directly to factories and bulk consumers rather than being sold through conventional petrol pumps. The price revision is therefore expected to have an immediate impact on industries with high fuel consumption, particularly those dependent on captive power generation and continuous process operations.
The textile industry, in particular, remains highly sensitive to fluctuations in fuel prices due to its reliance on fossil fuels for both power and heat-intensive processes. Diesel continues to play a critical role in generator operations as well as in thermal applications such as dyeing and finishing.
Data from the Annual Survey of Industries for 2022–23 indicates that diesel accounts for approximately 1,700 MW of installed captive power capacity in the textile sector. In terms of energy mix, it contributes roughly 5%–6% of captive power generation, underscoring its role as a supplementary but essential energy source.
Analysts note that sustained increases in industrial fuel costs could weigh on operating margins, particularly for small and medium enterprises, which have limited ability to absorb such shocks.
Industry observers also indicate that the rise in input costs is likely to increase freight and transportation costs, potentially feeding into broader inflationary pressures if companies choose to pass on the additional burden to end consumers.
“Though the textile industry had created a good capacity on non-renewable, dependence on diesel is still high for allied activities at least,” said Confederation of Indian Textile Industry (CITI) Secretary General, Chandrima Chatterjee.
