Govt to meet stakeholders to assess impact of Iran-Israel conflict on trade

The commerce ministry on Friday will meet stakeholders, including shipping lines, exporters, container firms, and other departments, to assess the impact of the Iran-Israel conflict on India's overseas trade and address related issues, an official said.
The industry official said that the meeting will be chaired by Commerce Secretary Sunil Barthwal.
"The meeting is today. We will raise issues related to freight rates," the official said.
Barthwal has earlier stated that India is keeping a close watch on the situation.
Exporters have stated that the war, if escalated further, would impact world trade and push both air and sea freight rates.
They have expressed apprehensions that the conflict may impact the movement of merchant ships from the Strait of Hormuz and the Red Sea.
Nearly two-thirds of India's crude oil and half of its LNG imports pass through the Strait of Hormuz, which Iran has now threatened to close.
This narrow waterway, only 21 miles wide at its narrowest point, handles nearly a fifth of global oil trade and is indispensable to India, which depends on imports for over 80 per cent of its energy needs.
According to think tank GTRI, any closure or military disruption in the Strait of Hormuz would sharply increase oil prices, shipping costs, and insurance premiums, triggering inflation, pressuring the rupee, and complicating India's fiscal management.
Meanwhile, Israel's June 14-15 strike on Houthi military leadership in Yemen has also heightened tensions in the Red Sea region, where Houthi forces have already attacked commercial shipping.
For India, this poses another serious risk. Nearly 30 per cent of India's west-bound exports to Europe, North Africa, and the US East Coast travel through the Bab el-Mandeb Strait, now vulnerable to further disruption, the GTRI has said.
The present conflict that began with an attack on Israel on October 7, 2023, had brought cargo movement through Red Sea routes to a halt due to attacks by Houthi rebels on commercial shipping. After the US intervened with attacks on the rebels, the firing on commercial ships stopped.
Last year, the situation around the Bab-el-Mandeb Strait, a crucial shipping route connecting the Red Sea and the Mediterranean Sea to the Indian Ocean, escalated due to attacks by Yemen-based Houthi militants.
Around 80 per cent of India's merchandise trade with Europe passes through the Red Sea, and substantial trade with the US also takes this route. Both these geographies account for 34 per cent of the country's total exports.
The Red Sea Strait is vital for 30 per cent of global container traffic and 12 per cent of world trade.
India's exports to Israel have fallen sharply to USD 2.1 billion in 2024-25 from USD 4.5 billion in 2023-24. Imports from Israel came down to USD 1.6 billion in the last fiscal from USD 2.0 billion in 2023-24.
Similarly, exports to Iran, amounting to USD 1.4 billion, which were at the same level in 2024-25 as well as in 2023-24, could also suffer. India's imports from Iran were at USD 441 million in FY25 as against USD 625 million in the previous year. The conflict adds to the pressure that the world trade was under after the US President Donald Trump announced high tariffs.
Based on the tariff war impact, the World Trade Organisation (WTO) has already said that global trade will contract 0.2 per cent in 2025 as against the earlier projection of 2.7 per cent expansion.
India's overall exports had grown 6 per cent on year to USD 825 billion in 2024-25.

Try Our AI Features

Explore what Daily8 AI can do for you:

Learn with AIFact CheckingText to SpeechAI Summary

Related Articles

Mint

31 minutes ago

• Mint

‘Critical to avoid spiral of chaos': How world leaders react to US attack on Iran

Iran-Israel War: World leaders reacted to President Donald Trump's Sunday announcement that the United States had attacked three nuclear sites of Iran, joining Israel's efforts to target the Islamic Republic's nuclear facilities as the conflict entered its second week. Israeli Prime Minister Benjamin Netanyahu said Trump's bold decision will change history. 'President Trump and I often say: 'Peace through strength.' First comes strength, then comes peace. And tonight, Donald Trump and the United States acted with a lot of strength,' Netanyahu said. United Nations Secretary-General Antonio Guterres warned that the US strikes on Iran represent a dangerous escalation in an already volatile region, posing a serious threat to global peace and security. 'There is a growing risk that this conflict could rapidly get out of control – with catastrophic consequences for civilians, the region, and the world,' Guterres said in a statement as reported by news agency Reuters. 'At this perilous hour, it is critical to avoid a spiral of chaos. There is no military solution. The only path forward is diplomacy. The only hope is peace,' he said. Venezuela condemned the US 'military aggression'. The country's foreign minister, Yvan Gil, posted on Telegram demanding an immediate 'cessation of hostilities'. "The Bolivarian Republic of Venezuela firmly and categorically condemns the bombing carried out by the United States military, at the request of the State of Israel, against nuclear facilities in the Islamic Republic of Iran, including the Fordow, Natanz, and Isfahan complexes," Gil said in a statement as quoted by Reuters. Mexico's foreign ministry urgently called for diplomatic dialogue for peace between the parties involved in the Middle East conflict. "In keeping with our constitutional principles of foreign policy and our country's pacifist conviction, we reiterate our call to de-escalate tensions in the region. The restoration of peaceful coexistence among the states of the region is the highest priority," it said in a post on X Cuba's president, Miguel Díaz-Canel, also condemned the attack. There is no military solution. The only path forward is diplomacy. The only hope is peace. "We strongly condemn the US bombing of Iran's nuclear facilities, which constitutes a dangerous escalation of the conflict in the Middle East. The aggression seriously violates the UN Charter and international law and plunges humanity into a crisis with irreversible consequences," Canel said in a post on X. (This is a developing story. Check back for updates)

Time of India

31 minutes ago

• Time of India

Israel coordinated with US in advance of Iran strikes, officials say

Live Events As the Iran-Israel conflict enters its second week, US airstrikes have marked Washington's official entry into the confrontation. On Sunday, June 22, the United States conducted strikes on three key Iranian nuclear facilities: Fordow, Natanz, and the operation, Israeli officials confirmed that Israel was informed of the US attacks in advance and had coordinated with Washington. According to Israel's state broadcaster Kan, officials said Israel was 'in full coordination' with the United States regarding the airstrikes on Iranian targets. Axios also reported that Israeli officials confirmed Tel Aviv had prior knowledge of the planned US military read: US bombs Iran's nuclear sites: All you need to know about the Iranian facilities that are hit by American Israeli officials stated that the United States used B-2 stealth bombers to carry out the attacks. These aircraft, which are capable of deploying large bunker-busting bombs, were previously stationed in Guam and deployed ahead of the operation. The B-2's ability to evade radar and strike fortified targets is seen as a critical asset in targeting deeply buried nuclear facilities such as President Donald Trump confirmed the strikes in a post on Truth Social, stating, 'We have completed our very successful attack on the three Nuclear sites in Iran, including Fordow, Natanz, and Esfahan. All planes are now outside of Iran air space.'He further added, 'A full payload of BOMBS was dropped on the primary site, Fordow. All planes are safely on their way home.' Trump also claimed in a separate post that the Fordow nuclear facility 'is gone' following the US airstrikes represent a significant escalation in the ongoing conflict that began with Israel's Operation Rising Lion on June 13. The initial Israeli campaign targeted Iranian nuclear and military sites, triggering retaliatory threats from Tehran and drawing regional and global attention to the potential for broader read: Investors brace for oil price spike, rush to havens after US bombs Iran nuclear sites The coordination between Israel and the United States highlights the deepening military cooperation between the two countries in responding to perceived threats from Iran's nuclear infrastructure. However, Iran has not yet responded publicly to the US strikes, and further developments are expected to shape the trajectory of the use of strategic bombers and full-scale airstrikes underscores the high stakes involved in neutralizing fortified nuclear sites and reflects growing concerns among US and Israeli officials over Iran's uranium enrichment activities.

Hindustan Times

32 minutes ago

• Hindustan Times

Khamenei's circle issues stark warning after US strikes Iran: 'Target naval fleet'

As tensions continue to escalate in the Middle East, several Iranian officials have warned of 'severe consequences' for the US in response to its recent strikes in Iran. Iranian Supreme Leader Khamenei had warned of the US of severe consequences in case of its intervention.(AP) Reacting to the US' strikes on Iran, a representative for Iran's supreme leader Ayatollah Ali Khamenei has issued a fresh warning to the United States. Follow LIVE updates on Iran-Israel war here. "It is now our turn to act without delay. As a first step, we must launch a missile strike on the US naval fleet in Bahrain and simultaneously close the Strait of Hormuz to American, British, German, and French ships," Hossein Shariatmadari, was quoted as saying in Kayhan newspaper - a conservative and hard-line Iranian daily. Shariatmadari is the managing editor of Kayhan, and is also described as a close confidant of the Supreme Leader Ali Khamenei. Also Read: 'Future attacks will be lot greater, easier': Trump in address to nation after Iran strikes Khamenei's warning ahead of strikes While an official statement and reaction from Khamenei is awaited, the Ayatollah's Telegram account reposted an earlier warning issued by the Supreme Leader. In his statements during a televised address, Khamenei warned the US against military intervention in the Iran-Israel conflict. 'The damage it will suffer will be far greater than any harm Iran will encounter,' Khamenei says in the video. 'The Americans should know that any US military intervention will undoubtedly be accompanied by irreparable damage,' said Khamenei, adding that 'the US is entering in this matter [war] is 100% to its own detriment. The damage it will suffer will be far greater than any harm that Iran may encounter.'