Israel-Iran conflict may impact India`s exports in Gulf region for short-term: FIEO
Amidst ongoing Israel-Iran conflict, the Federation of Indian Export Organisations (FIEO) has indicated that the conflict could impact demand and logistics in the short term, especially in the Gulf region which serves as a crucial hub for Indian exports. It added that this conflict may also lead to increased shipping costs, longer transit times, and hike in marine insurance premiums.
Talking about impact of the war on country's trade, FIEO President S C Ralhan said that the movement of consignments through Strait of Hormuz are still open and freight rates are stable so far. He also raised concerns about both inflation and logistics costs amid volatility in crude oil prices. However, he added that country's diversified energy procurement strategy and the Reserve Bank's proactive stance will help maintain liquidity and macroeconomic stability.
Ralhan said though there are temporary headwinds, they see this as an opportunity for Indian exporters to explore alternate routes, strengthen regional partnerships, and consolidate India's role as a reliable trade partner in uncertain times. He noted that while both Iran and Israel are important trading partners of the country, they constitute a small share of overall export-import basket. He also said the government and industry are jointly monitoring developments to ensure minimal disruption
