NEW DELHI: India would cut import duties and regulate exports if necessary to ensure adequate domestic supplies of essential products whose availability is restricted by war in the Middle East, the country’s head of foreign trade said on Thursday.
The conflict, which began at the end of February after the United States and Israel attacked Iran, has effectively closed the Strait of Hormuz, which is typically the route for about 20% of the world’s oil flows. As a result, energy and freight costs have surged and global supply chains are under severe strain.
India’s government is examining cuts to import duties on critical raw materials and other essential goods, Director General of Foreign Trade Lav Agarwal said.
Without specifying which goods were most at risk, he said India may regulate exports to ensure adequate domestic availability, adding authorities would maintain watchlists of sensitive products to ensure the timely imposition of any measures needed.
India allows export zones to sell locally as trade strains grow
The government is also reviewing trade defence measures, such as anti-dumping duties, in coordination with the revenue department, Agarwal said while addressing a daily government briefing.
The Middle East conflict has disrupted India’s gas supplies affecting parts of India’s manufacturing sector, air travel and shipping.
New Delhi has cut excise duties on petrol and diesel to shield consumers and curb inflation. It has also implemented support measures costing 18 billion rupees ($193 million), including scrapping import taxes on petrochemical inputs for plastics and pharmaceutical production.
American Dollar Exchange Rate