India On High Alert As Iran Considers Closing Strait Of Hormuz: GTRI
Nearly $1.2 trillion worth of maritime trade passes through the Gulf annually.
India faces mounting economic and energy security risks as Iran considered closing the Strait of Hormuz, a critical global oil and LNG shipping route. According to Ajay Srivastava, former Trade Services officer and founder of Global Trade Research Initiative (GTRI), any disruption could severely impact India, which relies on the waterway for nearly two-thirds of its crude oil and half of its LNG imports.
Although Iran’s parliament passed a resolution on June 22 backing closure, the final decision rests with the country’s Supreme National Security Council. The Strait remains open for now, but escalating tensions with the U.S. have raised the concerns of conflict and global supply chain shocks.
"The closure would send oil prices soaring, inflate India’s import bill, and worsen the fiscal outlook," GTRI warned. It also flagged a likely spike in freight rates and insurance costs, with knock-on effects for India’s trade with Europe and the U.S.
Nearly $1.2 trillion worth of maritime trade passes through the Gulf annually. A shutdown could disrupt Qatar’s LNG supply to Europe and cause serious shortages of chemicals, metals, fertilizers, and food products in India.
Compounding the threat is a deteriorating security situation in the Red Sea, where Israeli strikes on Houthi rebels have jeopardised Indian shipments via the Bab el-Mandeb Strait. A reroute around Africa could delay cargo by two weeks and raise shipping costs sharply.
GTRI said the risk of global escalation involving U.S., Israel, Iran, China, and Russia is “the closest the world has been to a World War III–level confrontation in decades.”
