Iran-Israel war Impact on India: Iran war impact on India; Pressure on energy and export sectors is likely to increase

• The aftermath of the Iran-US-Israel conflict
• Indian rice traders hit
• Rising pressure on India’s inflation rate

Iran-Israel war Impact on India: The effects of the Iran war are now being felt. The ongoing war in Iran may have a direct and indirect impact on India’s trade, particularly in the energy sector. India is a major importer of crude oil and is heavily dependent on West Asian countries. If the conflict in Iran escalates and disrupts oil traffic through the Strait of Hormuz, global crude oil prices may rise. This could increase India’s import bill and put pressure on inflation.

After the attacks by the US and Israel, Iran also launched missile attacks. These rising tensions in the Middle East are affecting Indian rice exporters. Ships carrying rice exported by India are stranded. This has increased the concern of exporters. According to reports, Haryana’s rice exporters are facing disruptions to send to Iran and Afghanistan following the attacks on Iran by the US and Israel.

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Sushil Kumar Jain, state unit president of the Rice Exporters Association, said the war has started affecting the rice trade. Shipments bound for Afghanistan via Abbas, Iran’s largest port, are stuck. He said these shipments will remain on hold until the situation improves, which could affect the market and delay payments. However, according to Jain, it is too early to assess the full impact.

Regarding basmati rice exports, Sushil Kumar Jain said that Haryana accounts for about 35 percent of India’s annual rice exports. According to Neeraj Kumar of a rice mill in Karnal, uncertainty has been building since the clashes started on Saturday. Trading has been affected in a single day, with prices of basmati rice falling by around Rs 4-5 per kg or Rs 400-500 per quintal. A similar effect was observed during the Iran-Israel conflict in June 2025, he explained.

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On the export front too, the situation may become difficult. The Middle East is an important market for India. If instability increases there, it could affect India’s exports of medicines, grains, textiles and engineering goods. Increased transportation costs, increased insurance premiums and changes in shipping routes can increase trade costs. At the same time, it may also create opportunities for some sectors. If the global supply chain is disrupted, India may emerge as an alternative supplier. However, overall, if tensions with Iran escalate, India’s import-export balance is likely to come under pressure.