New Delhi: The government is considering measures to support exporters, including those from the sugar sector, who are facing difficulties in sending shipments due to the ongoing conflict in West Asia. Commerce and Industry Minister Piyush Goyal said on Friday that policy tools under the Export Promotion Mission could be used to help exporters affected by the crisis, Financial Express reported.
Speaking on the sidelines of a vice chancellorsтАЩ conclave organised by the Indian Institute of Foreign Trade, Goyal said an inter-ministerial group is in regular contact with exporters to understand the challenges arising from the disruption in the region.
He said the group interacts with exporters daily to gather feedback, and the government is ready to extend support where needed. The commerce ministry is also coordinating with the shipping ministry to address problems related to cargo that has been delayed because of the conflict.
Exporters, including those dealing in sugar and other commodities, have been facing major challenges since the crisis began on February 28. Many shipments to West Asia are currently stuck as the Strait of Hormuz has been closed and several port facilities in the region have come under attack.
West Asia is not only a key destination for Indian exports such as sugar but also an important transshipment hub. Shipping routes through the region provide the shortest passage for cargo heading to markets in the United States, Europe and Africa.
Reports indicate that about 147 container vessels are currently stranded in the region. Nearly 105 ships are stuck inside the Persian Gulf, while the remaining vessels are waiting near the Gulf of Oman without clear instructions on where to unload cargo.
Several major shipping companies have declared an тАЬend of voyageтАЭ and diverted cargo to safer ports. These include Port of Salalah, Jeddah Islamic Port, King Abdullah Port and Port of Colombo.
The disruption has also affected shipping routes to other global markets. Cargo bound for the US and Europe is now being diverted through the Cape of Good Hope, which has increased transit time by 14 to 21 days and pushed up freight costs.
Shipping lines have also imposed contingency charges ranging from $2,000 to $4,000 per 40-foot container on cargo moving through the affected region. Exporters say these charges are being levied even on shipments that had already reached West Asian ports before the conflict began and were waiting to be unloaded.
Goyal said the government is in discussions with the shipping ministry and shipping companies to find a solution so that exporters can continue to meet commitments made to overseas buyers.
Exporters have also sought additional support from the government. Among the key demands are higher rates under the Remission of Duties and Taxes on Exported Products (RoDTEP) scheme and relief in insurance costs from the Export Credit Guarantee Corporation of India. They have also requested higher working capital limits and credit extensions similar to the support provided during the COVID-19 period.
