New Delhi: The government on Monday held inter-ministerial deliberations with exporters and logistics players to assess the impact of the war in West Asia on India's trade and assured all measures to mitigate any disruptions.
At a meeting called by the department of commerce, stakeholders presented an assessment of the evolving operational environment including routing and transit-time changes, vessel scheduling adjustments, container/equipment availability, freight and insurance cost trends, and implications for time-sensitive exports.
"Shipping lines through West Asia are closed at present and some have imposed emergency contingency surcharge while others are refusing voyage through the Suez Canal. This means additional freight," said an industry representative who attended the meeting.
Moreover, there is a safety issue for containers on board which haven't crossed the Suez Canal. Exporters flagged higher reinsurance premiums and sought a relaxation in banking rules for goods to be exported within 90 days from the invoice date.
"Mechanisms for facilitation of time-sensitive export segments such as perishables, pharmaceuticals and high-value manufactured exports were also discussed," the commerce and industry ministry said in a statement.
The consultation was with all stakeholder ministries and key logistics and trade facilitation partners to review the emerging geopolitical situation and its potential impact on India's export-import cargo flows, including the export ecosystem.
West Asia is India's third-largest export destination after US and EU, and a key transshipment region.
Exporters of perishable items raised issues related to delays as the Strait of Hormuz has been closed for marine traffic which will affect Indian fruits and vegetables headed to certain West Asian countries. Apparel exporters urged the government to waive demurrage on export cargo that are delayed at airports, as flight disruptions may impact movement of consignments.
Gems and jewellery exporters are concerned since West Asia accounts for 30% of their shipments.
Air freight capacity is 18% down compared with last week, exporters said. "Port congestions are expected if the crisis continues for a week and factories here will face inventory pileup," said an exporter. Industry has sought higher rates and value caps under the Remission of Duties and Taxes on Exported Products, which were reduced last week, the exporter said.
"The discussions covered the need to maintain predictability in cargo movement, minimise avoidable delays, and ensure seamless documentation and payment processes for exporters and importers," the ministry said, adding that the priority is to ensure continuity of EXIM logistics and mitigate any disruptions to India's trade flows.
The ministry emphasised that the approach will remain facilitative and coordinated, with a focus on maintaining supply chain resilience, protecting the interests of exporters, particularly MSMEs, with a view that essential imports required for domestic production and consumption are not adversely affected.
Strengthening facilitation at ports and inland container depots and ensuring smooth cargo evacuation to avoid congestion and extended dwell times were also taken up at the commerce department's stakeholder meeting.
Government reiterated its readiness to facilitate trade operations, including procedural flexibility in export-related authorisations in cases of genuine disruption, coordination with customs authorities to ensure smooth clearance and engagement with financial and insurance institutions to support exporter interests, according to the ministry.
At a meeting called by the department of commerce, stakeholders presented an assessment of the evolving operational environment including routing and transit-time changes, vessel scheduling adjustments, container/equipment availability, freight and insurance cost trends, and implications for time-sensitive exports.
"Shipping lines through West Asia are closed at present and some have imposed emergency contingency surcharge while others are refusing voyage through the Suez Canal. This means additional freight," said an industry representative who attended the meeting.
Moreover, there is a safety issue for containers on board which haven't crossed the Suez Canal. Exporters flagged higher reinsurance premiums and sought a relaxation in banking rules for goods to be exported within 90 days from the invoice date.
"Mechanisms for facilitation of time-sensitive export segments such as perishables, pharmaceuticals and high-value manufactured exports were also discussed," the commerce and industry ministry said in a statement.
The consultation was with all stakeholder ministries and key logistics and trade facilitation partners to review the emerging geopolitical situation and its potential impact on India's export-import cargo flows, including the export ecosystem.
West Asia is India's third-largest export destination after US and EU, and a key transshipment region.
Exporters of perishable items raised issues related to delays as the Strait of Hormuz has been closed for marine traffic which will affect Indian fruits and vegetables headed to certain West Asian countries. Apparel exporters urged the government to waive demurrage on export cargo that are delayed at airports, as flight disruptions may impact movement of consignments.
Gems and jewellery exporters are concerned since West Asia accounts for 30% of their shipments.
Air freight capacity is 18% down compared with last week, exporters said. "Port congestions are expected if the crisis continues for a week and factories here will face inventory pileup," said an exporter. Industry has sought higher rates and value caps under the Remission of Duties and Taxes on Exported Products, which were reduced last week, the exporter said.
"The discussions covered the need to maintain predictability in cargo movement, minimise avoidable delays, and ensure seamless documentation and payment processes for exporters and importers," the ministry said, adding that the priority is to ensure continuity of EXIM logistics and mitigate any disruptions to India's trade flows.
The ministry emphasised that the approach will remain facilitative and coordinated, with a focus on maintaining supply chain resilience, protecting the interests of exporters, particularly MSMEs, with a view that essential imports required for domestic production and consumption are not adversely affected.
Strengthening facilitation at ports and inland container depots and ensuring smooth cargo evacuation to avoid congestion and extended dwell times were also taken up at the commerce department's stakeholder meeting.
Government reiterated its readiness to facilitate trade operations, including procedural flexibility in export-related authorisations in cases of genuine disruption, coordination with customs authorities to ensure smooth clearance and engagement with financial and insurance institutions to support exporter interests, according to the ministry.
