Centre monitoring Gulf crisis 24x7, plans insurance aid for exporters

The Centre is considering insurance-based support measures for Indian exporters facing disruptions in shipments and rising logistics costs due to the ongoing crisis in West Asia, Commerce and Industry Minister Piyush Goyal said on Tuesday.

Speaking to reporters, Goyal said the government is in consultations with the Export Credit Guarantee Corporation of India (ECGC) and other departments to develop schemes that can provide insurance protection to exporters whose consignments are affected by the geopolitical tensions in the region.

According to the minister, an inter-ministerial group is monitoring the situation on a daily basis and maintaining close contact with exporters to assess the impact on trade. The government is particularly concerned about shipments that have already been dispatched but are facing delays, rerouting or uncertainty due to disruptions in maritime transport.

The crisis has disrupted global shipping routes, particularly traffic passing through the strategically important Strait of Hormuz , a crucial corridor for international oil supplies and cargo movement. The tensions, triggered by recent military developments involving the United States, Israel and Iran , have pushed up logistics costs worldwide. Ocean freight rates and air cargo charges have surged, while marine insurance premiums have reportedly risen by as much as 10 to 15 times , reflecting the heightened risk faced by vessels operating in the region.

To address logistical issues, the Customs department has issued guidelines for handling export cargo that is returning to Indian ports because vessels were unable to reach their destinations or had to alter routes due to security concerns.

Officials said the proposed insurance support could help exporters cover risks related to shipment delays, cargo diversion, higher insurance costs and potential payment defaults from overseas buyers .

West Asia remains a major export destination for India , particularly for petroleum products, engineering goods, food items and textiles. With trade flows facing uncertainty, the government said it is closely tracking developments and exploring policy tools to ensure exporters remain protected from sudden geopolitical shocks.