Indian exporters and logistics providers are scrambling to limit disruptions from the worsening Middle East conflict by closely tracking shipping carriers, planning consignments earlier and exploring alternate routes, even as freight rates, insurance premiums and transit times rise sharply amid uncertainty around the Strait of Hormuz.The main response from the exporting community has been defensive rather than optimistic, with businesses adjusting inventory, contracts and delivery schedules to build in flexibility as the conflict threatens cargo movement and supply chains.“Things are not improving, but we are trying to manage our exports. Shipping lines should not take undue advantage of this situation,” Federation of Indian Export Organisations (FIEO) president SC Ralhan said, as quoted by news agency PTI.The ongoing geopolitical tensions in the Middle East, particularly around the Strait of Hormuz, are creating uncertainty for India’s exports, with exporters reporting surcharges, longer transit times and higher insurance costs.
Exporters shift routes, brace for delays
According to PTI, shipping lines are increasingly rerouting consignments around the Cape of Good Hope, circling Africa to avoid the Strait of Hormuz and the Red Sea. These diversions add roughly 3,500 nautical miles to voyages, delay shipments by around 10 to 15 days, and significantly increase fuel and insurance expenses.That, in turn, is likely to make deliveries to key markets such as the US and Europe more expensive. Industry experts also warned that longer voyages could tighten vessel and container availability in the coming weeks, further pushing up freight rates.Council for Leather Exports Chairman Ramesh Kumar Juneja told PTI that shipments to the Persian Gulf have “stopped completely”.“Insurance premiums have increased. On a 20-foot container, it has increased by $1,200 and $2,400 on 40 ft,” he said.
Apparel and manufacturing sectors feel pressure
An apparel industry expert cited by PTI said that export orders to the Middle East may weaken in the coming months as war-hit markets come under stress and consumer demand softens.About 11.8 per cent of India’s apparel exports go to Middle Eastern countries directly affected by the conflict. India’s ready-made garment exports to eight countries — UAE, Saudi Arabia, Israel, Kuwait, Oman, Qatar, Iraq, Bahrain and Iran — stood at $1.9 billion in 2024-25, up from $1.82 billion in 2023-24. India’s total garment exports rose to $15.97 billion from $14.51 billion in the same period.The expert also warned that textile manufacturers dependent on imported raw materials such as synthetic fabrics, trimmings and embellishments could face shortages or cost escalation if disruptions persist, leading to higher final product costs.
Government weighs support measures
Businesses said regular advisories, engagement with shipping lines on surcharges, ensuring vessel and container availability, flexibility in compliance timelines, and closer coordination between industry bodies and the government would help manage the crisis.The commerce department is working on support measures, including prioritising shipment of perishables, even by air, and examining insurance support for exporters. Officials are also exploring whether goods can be rerouted through alternative ports in Middle East.A senior government official said there will be “some impact”, likely visible in this month’s trade data, but exporters have been asked to look at other markets to fill any gaps. An inter-ministerial group is monitoring the situation daily and coordinating with exporters, while customs, the shipping ministry and DG Shipping have already announced some measures.
