Iran Conflict Halts Exports to Gulf and West, Shipping Lines Levy Emergency Charges of Up to $4,000 Per Container

India’s exports to the Gulf and several Western markets have ground to a halt amid escalating tensions following Iran’s retaliatory strikes after attacks by the United States and Israel. Heightened security risks in the region have prompted shipping companies to impose emergency conflict surcharges ranging from $2,000 to $4,000 per container on cargo moving to and from Gulf and West Asian destinations.

The new charges came into effect on March 2. Senior government sources told Rural Voice that a high-level meeting has been convened at the Ministry of Commerce to assess the situation. The meeting was called by the Director General of Foreign Trade (DGFT).

According to information available to Rural Voice, shipping companies have notified exporters that the emergency conflict surcharge will apply to all new bookings. The surcharge covers shipments to and from ports in Iraq, Bahrain, Kuwait, Yemen, Qatar, Oman, the United Arab Emirates (UAE), the Kingdom of Saudi Arabia, Jordan, Egypt (Port of Ain Sokhna), Djibouti, Sudan, and Eritrea.

Under the revised pricing structure, an additional $2,000 will be charged per 20-foot dry container, $3,000 per 40-foot container, and $4,000 per container for reefers or special equipment, over and above the existing freight rates.

Export industry representatives say shipments under such elevated costs are commercially unviable, as margins would be severely eroded. According to industry sources, exports of agricultural and allied products to these destinations, both by sea and air, have currently been suspended.

The Delhi-based think tank Global Trade Research Initiative (GTRI) estimates that India exported approximately $1.2 billion worth of goods to Iran in calendar year 2025, with agricultural commodities accounting for the bulk of shipments. Rice exports alone were valued at $747 million, followed by bananas at $61 million and tea at $51 million.

Industry officials also point to operational disruptions at ports as an additional concern. Loading of cargo bound for affected countries has reportedly been halted, which could result in port authorities levying ground charges of around $100 per day on stranded containers.

Sources within the Commerce Ministry indicate that exports to Europe and other markets routed through the affected corridor have also been disrupted. While the government is reviewing the evolving situation, no formal assessment of the trade impact has yet been made.

Officials from export promotion bodies and major shipping lines have also been invited to the Commerce Ministry meeting. The government is expected to urge shipping companies to reconsider or moderate the newly imposed surcharges to ease the burden on exporters.