Government, exporters, shipping firms to meet on Monday to assess impact of Iran tensions on trade
Exporters have expressed serious concerns that the war will affect trade routes through the Strait of Hormuz and the Bab el-Mandeb Strait
The Commerce Ministry has convened a meeting of exporters, shipping lines, freight forwarders and officials from other ministries on Monday to assess the impact of escalating tensions in the Middle East region on India's trade.
The US and Israel jointly launched military strikes on Iran on Saturday. Iran responded by firing drones and missiles at Israel and US military installations around the Gulf, and also at the global business hub of Dubai.
The ministry has called the meeting in a hybrid mode to assess the impact of the evolving situation on India's trade, the official said.
Exporters have expressed serious concerns that the war will affect trade routes through the Strait of Hormuz and the Bab el-Mandeb Strait. Both are key for movement of ships. It connects India to the Gulf region, North America and Europe.
Federation of Indian Export Organisations (FIEO) President SC Ralhan said the ongoing conflict has already begun to disrupt established global logistics channels.
Air routes are being altered, and maritime trade through the Red Sea and key Gulf straits faces heightened uncertainty. If diversions become prolonged, shipments may increasingly have to reroute via the Cape of Good Hope, adding an estimated 15 20 days to transit time for Europe and the United States, Ralhan has said.
The disruptions may push freight rates and insurance premiums for traders.
Exporters stated that it may take few days to get a clarity on the availability of shipping capacity, new routes, insurance and freight rates.
West Asia has major routes through which India's exports to the biggest markets of the US and Europe pass.
India's exports to the US stood at USD 86.5 billion, USD 98.4 billion to Europe and USD 58.8 billion to West Asia. Taken together, these regions account for about 56 per cent of India's merchandise exports.
From 2023 to 2025, the conflict between Israel and Hamas led to a significant jump in freight rates and transport movement times. Shipping lines had to abandon the Red Sea route and used the Cape of Good Hope on the tip of Africa, increasing travel times by 15-20 days between India and the West.
Though last time the tensions were limited to an area, this times situation does not look good.
Freight rates are usually adjusted at the start of the month by major shipping lines, and on Monday, new rates will be published, he said. At the start of 2026, the rates were contracting.
