Ocean carriers suspend cargo bookings between India and the Middle East due to escalating military tensions, impacting trade and supply chains.
Supply chains between India and the Middle East have stalled after ocean carriers suspended services and cargo acceptance amid the military conflict between Iran, the US, and Israel, reported New York's Journal of Commerce.
India faces major economic risks as the UAE is its second-largest trading partner. The two countries signed a trade pact in 2022 to boost non-oil trade to US$100 billion by 2030. Reefer shipments were first affected, but carriers have now stopped all Middle East bookings.
Maersk announced it was suspending all new bookings between the Indian Subcontinent and Upper Gulf markets, including the UAE, Bahrain, Qatar, Iraq, Kuwait, and Saudi Arabia. Mediterranean Shipping Co (MSC), Hapag-Lloyd, and Ocean Network Express (ONE) have also halted bookings.
ONE stated it was assessing cargo already in transit on a voyage-by-voyage basis. Carriers have imposed war risk and emergency surcharges ranging from US$1,500 to US$3,000 per container. Maersk levied US$1,800 per TEU, US$3,000 per FEU, and US$3,800 for reefer boxes.
Sunil Vaswani, executive director of the Container Shipping Lines Association (India), indicated that cargo bound for the Middle East is piling up at Indian ports and warned that congestion will worsen if the crisis is not resolved quickly.
The disruption is also affecting Indian exports to Europe. Seasonal grape shipments now face longer or unpredictable transits as vessels divert around southern Africa following the suspension of Red Sea and Suez Canal routes.
