From oil prices to trade, what impact will the Iran-US-Israel tension have on India? Understand in 6 easy points

Middle East Crisis Impact on India: in the middle east Increasing conflict between America, Israel and Iran It is not just a regional crisis, it can have a direct impact on India’s economy, trade, oil, flights and the pockets of common people. The government is keeping a close eye on this, because if the war continues for a long time then the impact can be deep. Oil prices may increase, which will increase inflation.

us President donald trump have said in clear words that they will not allow Iran to have a nuclear bomb. He said that the ongoing operation against Iran may continue for 3-4 more weeks. Come, let us know what impact it can have on India…

1- Oil and gas prices

• India imports most of its crude oil needs, a large part of which comes from the Middle East. This oil mostly passes through the Strait of Hormuz, which is the most important sea route in the world.
• Due to the war, the fear of oil supply disruption has increased and prices have increased by more than 10%. If this increase continues, petrol and diesel will become expensive, inflation will increase and there will be pressure on the government.
• India brings about 25–27 lakh barrels of oil every day through this route, especially from Iraq, Saudi Arabia, United Arab Emirates and Kuwait… If this route is closed then oil will have to be brought from Russia, America or Africa, but it will take more time and expense.

2- Pressure on stock market and rupee

As soon as the news of tension came, there was panic in the market. Bombay Stock Exchange’s Sensex fell by more than 1000 points and National Stock Exchange of India’s Nifty also slipped. The rupee also weakened and crossed 91 per dollar. If the war continues for a long time, investment, trade and economic development may be affected.

3- Threat to trade and supply chain

• Major trade of India is done through the sea routes of the Middle East.
• If routes like Bab el-Mandeb Strait and Hormuz are closed or unsafe, then ships will have to take the longer route to Africa, which will take 15-20 days more and increase the cost.
• This will also affect India’s exports, especially rice, electronics and tech products.
• The Middle East is the largest market for India’s Basmati rice.
• Big shipping companies have closed some routes, due to which goods going to Europe and America will be delayed.

4- Flights stopped, thousands of Indians stranded

• Many flights were canceled due to unsafe airspace in the Middle East.
• Airlines like Emirates, Qatar Airways, Etihad Airways have reduced services.
• India’s Air India and IndiGo also have to run flights through alternative routes, due to which the time is increasing.
• Thousands of Indians are stranded due to the closure of major transit hubs like Dubai.

5- Inflation and everyday things become expensive

• The cost of oil affects not only petrol but also everyday things.
• The cost of soap, shampoo, packaging, paint, food items, everything increases.
• India imports pulses in large quantities every year, so if the supply is disrupted, pulses can also become expensive.
• If the earnings (remittances) coming from Gulf countries are affected, the economy of many states may also be affected.

6- Risk of increasing insurance and shipping expenses

Insurance of ships and planes becomes expensive in war zones. If insurance companies increase ‘War Risk Cover’ then both freight and tickets will become expensive.

What will happen if the conflict does not end soon?

If the conflict ends soon, the impact will be limited, but if it continues for a long time, India may have to face pressure on many fronts simultaneously – inflation, trade, oil, market and employment… The Indian government is currently focusing on alternative oil supply, strategic reserves and diplomatic efforts so that a major crisis can be avoided.