Indian Exporters Seek Government Support as West Asia Crisis Disrupts Shipping and Raises Freight Costs

FIEO urges immediate measures to restore direct vessel connectivity, improve schedule reliability, and contain rising logistics costs amid Red Sea disruptions.

Indian exporters have called for government intervention as the ongoing crisis in West Asia continues to disrupt global shipping networks, resulting in higher freight rates, fewer direct calls by mother vessels at Indian ports and greater dependence on overseas transshipment hubs.

In a letter addressed last week to Union Ports, Shipping and Waterways Minister Sarbananda Sonowal, the Federation of Indian Export Organisations (FIEO) sought an urgent meeting with the Ministry to discuss immediate and long-term measures to address the disruptions affecting exporters.

Key Demands

FIEO has requested rationalisation and greater transparency in freight and contingency charges, restoration of more direct mother vessel calls at Indian ports, measures to ensure adequate vessel capacity and schedule reliability, and the establishment of contingency mechanisms to minimise disruptions during future geopolitical crises.

“We want to take up with the Shipping Ministry the escalation in shipping related problems being faced by exporters and look for some solutions,” FIEO DG Ajay Sahai told BusinessLine.

The concerns have intensified as global shipping lines continue to increase freight charges. The latest development is French carrier CMA CGM’s announcement of a fresh Peak Season Surcharge (PSS), effective August 15, on cargo originating from India, Pakistan, Sri Lanka, the Middle East Gulf and Red Sea ports, and bound for the US East Coast, Gulf Coast and inland destinations, Sahai said.

Fresh Surcharges Introduced

The newly announced surcharge has been fixed at $5,000 per container across major cargo categories.

According to FIEO, the West Asia crisis has disrupted established shipping networks, leading to fewer direct calls by mainline vessels at Indian ports. As a result, a larger share of export cargo is being routed through overseas transshipment hubs such as Colombo, Singapore and Jebel Ali.

The organisation stated that increased reliance on feeder services has resulted in longer transit times, higher cargo handling costs and increased overall logistics expenses. Irregular sailing schedules and container shortages have further contributed to operational uncertainty.

Freight charges have continued to rise as shipping lines reroute services and adjust vessel capacity in response to security concerns in the Red Sea region.

Industry Seeks Policy Action

In its communication, FIEO said the developments come at a time when India is pursuing an ambitious export growth strategy, targeting merchandise and services exports of $2 trillion by 2032. The organisation noted that reliable, predictable and cost-efficient maritime connectivity is essential for achieving this objective.

FIEO also urged the government to work with shipping lines and port authorities to restore direct mainline connectivity, improve schedule reliability and strengthen India's maritime resilience against future geopolitical disruptions.

The organisation stated that timely intervention would help contain logistics costs and safeguard the competitiveness of Indian exports.