The new Delhi, 16 June (PTI) carefully monitors the situation resulting from the Iranian-Israeli conflict and this week there will be a meeting with shipping lines, container companies and other parties involved.
Trade Minister Sunil Barthwal said the impact of the war on Indian trade would depend on how the situation develops for a certain time.
“We are watching the situation. We are also calling a meeting (this week) of all shipping lines, container organizations and the departments and stakeholders in order to understand from them that what are the types of problems they face and how we can solve it,” he told reporters here.
Exporters said that the war, if further escalated, would affect the world trade and push the rates of air and sea costs.
They expressed concern that the conflict was expected to affect the movement of trading ships from the Hormuz and the Red Sea.
Almost two -thirds of Indian oil and half of his LNG imports are undergoing the Strait of Hormuz, which now threatened to close.
This narrow waterway, only 21 miles wide at its narrowest point, processes almost one fifth of global oil trade and is essential for India, which depends on imports for more than 80 % of its energy needs.
According to Think Tank Gtri, any closure or military disturbances of Hormuz would sharply increase oil prices, transport costs and premiums, which would cause inflation, pushed Rupee and complicated Indian fiscal control.
Meanwhile, the Israeli strike 14.-15. June, on the military leadership of Houthi in Yemen, also increased tension in the Red Sea area, where Houthi had already attacked commercial transport.
This is another serious risk for India. Almost 30 percent of Indian exports of the Indian West to Europe, North Africa and the American East Coast are traveling through the Strait of Bab El-Mandeb, now susceptible to further disruption, Gtri said.
Indian export consignments gradually began to move through the Red Sea route, but now it can be affected.
The cargo ships gradually returned to the Red Sea routes and saved them for 15-20 days when moving to the US and Europe from India and other parts of Asia.
The current conflict, which began by attacking Israel 7 October 2023, brought the movement of the cargo over the red sea routes to stop because of the attacks of the insurgents on commercial transport. After the US hit the rebels, shooting on commercial ships stopped.
Last year, the situation around the Strait of Bab-El-Mandeb, the key transport route connecting the Red Sea and the Mediterranean with the Indian Ocean, escalated because of the Houth Militants based on Yemen.
Approximately 80 percent of Indian trade in Europe is going through the Red Sea, and this journey also shows a considerable US trade. Both of these geography represent 34 % of the country’s total exports.
The fear of the Red Sea is vital for 30 percent of global container operation and 12 % of the world trade.
Indian exports to Israel sharply dropped to $ 2.1 billion in the years 2024-25 of $ 4.5 billion in the years 2023-24. Imports from Israel fell to $ 1.6 billion in the last fiscal of $ 2.0 billion in the years $ 2023-24.
Similarly, exports to Iran could suffer from $ 1.4 billion, which were at the same level in 2024-25, as in 2023-24. Indian imports from Iran were $ 441 million in FY25 in FY25 in FY25 compared to $ 625 million.
The conflict increases to the pressure world trade, which was under US President Donald Trump announced high tariffs.
Based on the impact on the Customs War, the World Trade Organization (WTO) has already stated that global trade in 2025 will close by 0.2 % compared to an earlier screening of 2.7 % of expansion.
Indian total exports that increased by 6 percent year-on-year to $ 825 billion in the years 2024-25.
(Tagstotranslate) Iranian-Israeli conflict
