West Asia shipping risks monitored daily by India inter-ministerial group, says Piyush Goyal
Commerce and Industry Minister Piyush Goyal said India has formed an inter-ministerial group that meets daily to monitor developments in West Asia. The group is assessing vulnerabilities affecting shipping, logistics, exports, and critical imports. Exporters have raised concerns that regional tensions could disrupt routes and increase freight and insurance costs.
Business
The Centre has formed an inter-ministerial group to track the West Asia situation every day. Commerce and Industry Minister Piyush Goyal said it will check risks to shipping, logistics, exports and key imports. Exporters have raised worries after a joint attack by the US and Israel on Iran. They fear route blocks, higher freight bills and rising insurance costs.
Goyal shared the update while speaking at a post-Budget webinar on Tuesday. Goyal said the group meets daily and will guide coordinated action across ministries. The first meeting took place on Tuesday, and ministries suggested steps. Goyal said the commerce ministry will also take suggestions to limit the crisis impact.
West Asia monitoring group reviews exports and imports risks
In a social media post, Goyal said the meeting included stakeholder ministries and key logistics partners. The focus stayed on the geopolitical situation and its possible effect on India’s exports and imports. Goyal said readiness measures included flexibility in export authorisations. The post also flagged coordination with customs and ports for smoother clearance.
Goyal also referred to engagement with banks and insurers to protect exporter interests. The minister said an IMG for supply chain resilience has been created. It includes the Department of Financial Services and the Ministry of External Affairs. It also includes the Ministry of Shipping, Ports and Waterways and other bodies.
The group also has members from the Ministry of Petroleum and Natural Gas. It includes the Central Board of Indirect Taxes & Customs as well. Goyal said the aim is better coordination, monitoring and follow-up. Goyal said the government remains committed to stable trade conditions and seamless operations for traders and exporters.
DGFT help desk and West Asia support for exporters
A 24×7 help desk has been set up at the Directorate General of Foreign Trade DGFT. It is meant for exporters and importers seeking support during disruptions. Exporters have already flagged the risk of higher costs and delays. They say shipping and insurance changes can affect contract prices and delivery schedules.
Federation of Indian Export Organisations FIEO Director General Ajay Sahai said the outlook remains unclear. “the situation is uncertain at the moment.\” Sahai said some shipping lines added a surcharge or contingency fee of USD 1,000-4,000. \”This will push transportation charges.\” Sahai added that the charges also applied to cargo already shipped.
\”Sadly these charges have also been imposed on consignments that have already left the ports,\” Sahai said. Sahai also said shipping lines face insurance gaps when passing through the Red Sea. Exporters fear a wider conflict may affect movement through Bab-el-Mandeb, the Red Sea and the Suez Canal. These waterways are key to trade links with Europe.
West Asia disruptions threaten Bab-el-Mandeb route and Suez Canal
The Bab-el-Mandeb Strait links the Red Sea and the Mediterranean Sea to the Indian Ocean. The route begins from Indian ports such as Mumbai, JNPT, or Chennai. Ships move west through the Arabian Sea into the Red Sea. They then pass the Suez Canal into the Mediterranean Sea, and on to European ports.
If this route faces disruption, vessels may divert via the Cape of Good Hope. That detour means sailing around Africa and can add about 15-20 days. The delay can affect shipments to Europe and the US. Exporters say such changes can disrupt schedules across supply chains and raise working capital needs.
Industry representatives said any logistics disruption can raise costs for shipping and containers. They also flagged possible increases in demurrage and insurance charges. Higher input costs can make goods less competitive in global markets. Re-routing can also slow deliveries, which may affect buyer confidence and future orders.
With inputs from PTI