Chennai: India’s engineering goods exports to the West Asia and North Africa (WANA) region declined sharply in March following the closure of the Strait of Hormuz. According to data from the Engineering Export Promotion Council (EEPC), total exports to the region declined by 50.7 percent.
According to the data, this decline was most pronounced in key export markets. Engineering exports to the United Arab Emirates (UAE) declined by 67 percent year-on-year, while exports to Saudi Arabia declined by 45 percent.
The UAE is considered an important trade-transshipment hub for Indian exports. Many Indian exporters utilize warehouse and logistics facilities in the UAE for onward trade with Europe, Africa, and the Americas. Therefore, any disruption in this region has a direct impact on the global supply chain.
The closure of the Strait of Hormuz has increased pressure on maritime routes, impacting shipping and logistics. This has slowed the movement of goods and led to a decline in export activity.
According to the EEPC, recent geopolitical tensions in the West Asia and North Africa region have also impacted trade activity. Instability in this region has affected warehouse operations and transshipment activities.
Experts believe that the impact of such a situation is not limited to a single region, but also impacts the global trade chain. Sectors such as engineering, which are heavily dependent on international supplies, suffer the most.
The WANA region is an important export market for India, with strong demand for engineering goods. Therefore, a decline in this sector could impact export figures.
According to trade analysts, if the situation in the Strait of Hormuz and surrounding areas does not return to normal soon, export pressure may persist in the coming months. This increases the likelihood of increased logistics costs and delayed delivery times.
Currently, Indian exporters are exploring alternative routes and markets to mitigate the impact. The government and export organizations are also monitoring the situation.
Overall, the closure of the Strait of Hormuz and regional tensions have dealt a significant blow to India’s engineering exports to the WANA region, leading to a significant decline in trade activity.
