– Crisis looms over India’s trade interests
– Rising energy prices will increase the cost of industries
– Import-export balance likely to be affected
Gurugram : Progressive Federation of Trade and Industry (PFTI) Chairman, Deepak Maini has said that the growing military confrontation between Israel and Iran can pose a serious threat not only to the stability of the Middle East region, but also to the global trade structure and import-dependent countries like India.
Maini said in a statement that if the Strait of Hormuz, which carries about 20 percent of the global crude oil supply, is disrupted, India’s energy supply will be badly affected. India imports about 80 percent of its total oil needs and a large share of it comes through this route. If this supply chain slows down or stops, then an unexpected increase in the prices of petroleum products in the domestic market is possible.
He said that the increase in energy costs will have a direct impact on the construction, transport and service sectors, which will lead to a huge increase in inflation and industrial production costs. This will not only put pressure on the consumer price index, but it will also become a challenge for India’s small and medium industries to survive.
Deepak Maini also expressed concern that if this conflict continues for a long time and big countries like America, China, Russia are directly or indirectly involved in it, then there will be a permanent impact on the global supply chain and investment flow. India’s exports will also come under pressure, especially in sectors like petro-chemicals, engineering goods, textiles and pharma.
He appealed to the Indian government to intensify its diplomatic efforts so that global initiatives can be taken to reduce tensions between the two sides. Also, it is also important that India immediately starts working on the supply of alternative energy sources so that any possible supply crisis does not affect the country’s economic progress.
Maini also said that in the current situation, policymakers need to increase focus on energy conservation, domestic production and strategic reserves so that such global events have minimal impact on Indian industry and common consumers.
This impact on Gurugram…
The PFTI chairman says that Gurugram is a major industrial and corporate hub of India. Manufacturing, automobiles, textiles, pharma and engineering goods are produced on a large scale from here, which are exported to international markets.
Gurugram’s logistics dependency is on Mumbai, Kandla and other ports of Gujarat, through which goods are sent to the Middle East, Europe and Africa and most of these cargo ships pass through the Strait of Hormuz.