Government prepares to tackle situation as it unfolds

India’s BSE Sensex slipped marginally from 81287 on 27 February to 80238 on 2 March, linked with developments around the assasination of Ali Khamenei, the Supreme Leader of Iran on 28 February. The price of gold in Mumbai touched its all-time high at ₹172,720 for 10gms of 24k quality on 3 March.

A number of steps have been taken by the Indian government since the destabalising events of end-February.

Soon after Israel and the US launched joint attacks on Iran, the Ministry of Civil Aviation held a meeting on the same day to review aviation preparedness.

The Cabinet Committee on Security (CCS) under the Prime Minister met on 1 March to review the situation in West Asia. It directed all departments to take necessary and feasible measures to assist Indian nationals affected by evolving developments. It also underscored the importance of an early cessation of hostilities and a return to dialogue and diplomacy.

Shipping traffic around the Strait of Hormuz had by then already started to grind to a halt. The bend which appears to be controlled by Iran is said to account for 20 per cent of oil and gas flows.

On 2 March QatarEnergy said that due to military attacks at operating facilities in Ras Laffan Industrial City and Mesaieed Industrial City in the State of Qatar, QatarEnergy has ceased production of liquefied natural gas (LNG) and associated products. Qatar is an exporter of liquefied natural gas to India.

On the same day Prime Minister Modi spoke with the King of Jordan, the Crown Prince of Saudi Arabia, the King of Bahrain and the Prime Minister of Israel. He condemned attacks on Saudi Arabia and Bahrain, and reaffirmed support for peace, security, and well-being of the people.

Modi, who has only just returned from Israel, offered no public sympathy for Iran. In his call with Israel, he reiterated the need for an early cessation of hostilities.

On 2 March, the Civil Aviation ministry announced that Indigo Airlines has planned 10 special relief operations from Jeddah to India on 3 March to facilitate the return of stranded passengers. Indigo is coordinating with the Consulate General of India at Jeddah for passenger facilitation.

On the same day, The Department of Commerce convened a stakeholder consultation to ensure trade continuity amid evolving geopolitical developments and its potential impact on India’s trade cargo flows, including the export ecosystem.

The consultation was chaired by the special secretary, Department of Commerce, Suchindra Misra and Director General of Foreign Trade Lav Agarwal. It was attended by representatives of logistics operators and shipping lines/forwarders, Central Board of Indirect Taxes & Customs, Department of Financial Services, Ministry of Petroleum & Natural Gas, Ministry of Ports, Shipping and Waterways, the Reserve Bank of India, and “export promotion ecosystem and other concerned agencies”.

Stakeholders presented an assessment of the evolving operational environment, including routing and transit-time changes, vessel scheduling adjustments, container/equipment availability, freight and insurance cost trends, and implications for time-sensitive exports. It was agreed amongst stakeholders to maintain close coordination for monitoring route and capacity developments, surcharges, and equipment availability.

Meanwhile, bombings from both sides continue. The US has not ruled out sending more boots on the ground, and the Central Command has said that “Operation Epic Fury involves the largest regional concentration of American military firepower in a generation”.