New Delhi, March 11: ASSOCHAM on Tuesday warned that a prolonged conflict in West Asia involving the United States, Israel and Iran could disrupt global trade flows and impact India’s energy supplies and exports.
The apex industry chamber said India’s economy remains closely linked to West Asian supply chains while the Gulf region continues to serve as a major export destination for Indian goods.
The Middle East is also a key supplier of crude oil, liquefied natural gas (LNG), petrochemicals, fertilisers and aluminium, making the region strategically important for India’s energy and industrial sectors.
According to ASSOCHAM, a key concern emerging from the Israel–Iran tensions is the potential disruption of oil and gas shipments through the Strait of Hormuz, a critical maritime chokepoint that carries around 20% of global oil supply and a significant share of worldwide LNG trade.
The chamber said any prolonged disruption in shipping routes could push global fuel prices higher, increasing costs across manufacturing, logistics and international supply chains.
Given India’s heavy dependence on imported crude oil, a sustained surge in international oil prices could widen the current account deficit, fuel inflationary pressures and weigh on economic growth, the industry body noted.
N. K. Minda, President of ASSOCHAM, highlighted that the Gulf region also plays a critical role as a hub for the Indian diaspora.
Citing the Reserve Bank of India Remittances Survey for 2023–24, he said the United Arab Emirates alone accounted for 19.2% of India’s total inward remittances, underscoring the economic importance of the region for India.
Meanwhile, Saurabh Sanyal, Secretary General of ASSOCHAM, said India imported goods worth around $98.7 billion from West Asia in 2025, including critical resources such as energy, fertilisers and industrial inputs.
He warned that energy-intensive industries could face challenges if supply disruptions persist, particularly at a time when global trade is already experiencing volatility and tariff uncertainties.
The chamber also pointed out that maritime disruptions in the Gulf have already delayed container shipments globally, affecting trade flows and delivery schedules.
For India, sectors such as gems and jewellery, pharmaceuticals, electronics, petroleum products and agricultural goods could face potential impacts if the conflict continues for an extended period.
ASSOCHAM welcomed the government’s move to establish an Inter-Ministerial Group on Supply Chain Resilience to monitor developments in Iran and the wider region and assess their potential impact on India’s trade and supply chains.
