US intervention in Israel-Iran war increases risks for India’s

With the US entering the Israel-Iran war with its strikes on Iran’s key nuclear sites, Indian exporters and importers have turned more jittery as retaliation by Tehran could increase transit risks in the region and destabilise global trade further. The Commerce & Industry Ministry is continuing to closely watch the situation as it develops and is in touch with stakeholders to take appropriate action when required, especially if there is a wider regional escalation, a source tracking the matter said. “For India, this is a moment of high stakes demanding its most delicate diplomatic balancing act yet to safeguard core interests and steer clear of entanglement in a spiralling global conflict,” pointed out Ajay Srivastava from GTRI. Geopolitical developments, such as the US strikes on Iran, have the potential to create uncertainty in global trade, particularly in terms of logistics, insurance costs, and regional supply chain disruptions, said Ajay Sahai, Director General, Federation of Indian Export Organisations. “While it’s too early to assess the full impact, such tensions often lead to increased volatility in oil prices, currency movements, and shipping routes—all of which are relevant to exports,” Sahai told. Developing situation The Commerce Department, held a meeting with stakeholders, including shipping lines and air cargo operators, on Friday. ASFI FORTNIGHTLY BULLETIN, JUNE – PART 2, 2025 2 Exporters and importers are apprehensive that the Red Sea route, which is used for connecting with Europe, many African countries and parts of the US, may be affected by the conflict. If the Strait of Hormuz is shut down by Iran, as is being feared, things may worsen and India’s oil supplies, too, will be hit.