Advantage Pak as India's basmati exports hit the Hormuz wall
Chandigarh, May 11 -- The ongoing West Asia conflict and the closure of the Strait of Hormuz have hit Indian basmati exporters hard, forcing many to reroute shipments through alternative ports to sustain exports to Gulf nations.
The Strait of Hormuz, which is just 39 km wide at its narrowest point, remains one of the world's most critical oil and supplies trade corridors.
The crisis has turned into an opportunity for Pakistan, which shares a 900-km land border with Iran and is now using two border crossings, Taftan and Gabd-Rimdan in Baluchistan, to move shipments via land, bypassing the Persian Gulf entirely under a barter trade arrangement for crude oil.
India exports at least 60 lakh tonnes of basmati annually, worth Rs.50,000 crore, out of which nearly two-thirds go to the Middle East. Iran alone imports at least 40% of the total exports to Gulf nations.
"Exports of basmati from India to Iran have been completely stopped due to war, and it is a direct gain of Pakistan, which is using the land routes to access the market," said Ranjit Singh Jossan, an exporter from Punjab, who is also the vice-president of the basmati exporters association in the state. Pakistan recently moved to formalise the barter trade and ease banking restrictions further to streamline the trade.
According to the data from the Agricultural and Processed Food Products Export Development Authority (APEDA), March this year witnessed a significant decline in rice exports to the Middle East.
In March 2025, India exported 4.7 lakh tonnes of rice worth approximately Rs.3,431.30 crore. However, figures for March this year show a sharp fall of nearly 40%. The latest APEDA data shows rice exports dropped to 2.76 lakh tonnes, valued at around Rs.2,240.37 crore.
Jossan said that with the direct movement through the Strait of Hormuz difficult, the exporters were forced to use alternative shipping routes for consignments bound for Iraq, Kuwait, Bahrain and other Gulf countries. Access to Iran's Bandar Abbas port, located on the Strait of Hormuz, is also restricted due to naval blockades and prohibitive insurance premiums.
"The Indian stocks were being diverted to trans-shipment hubs like Jebel Ali (the UAE), Hamad Port (Qatar), Aqaba Port (Jordan), Jeddah Port (Saudi Arabia), Aden Port (Yemen), Sohar (Oman) and a port in Muscat and also to ports of Khor Fakkan and Fujairah also in the UAE," he said.
The offloading of shipments at these neutral ports is expensive, as the exporter has to take into account land or feeder transports, which saddles him with war-risk surcharges and crippling delays.
"From these neutral and open ports, the consignments are then transported to Jebel Ali by road before being forwarded to Gulf destinations. Similarly, Saudi Arabia's Jeddah port in the Red Sea is also being used for shipments to Kuwait, Bahrain and Qatar. This has increased the logistical charges from US$ 500 to US$ 5,000," an exporter from Haryana said.
Ashok Sethi, director of the basmati exporters' association, said over 2 lakh tonnes of grain is stranded since March, when the conflict started. "Nearly 2,000 vessels loaded with chemicals, medicines and food grains are stuck near the Strait of Hormuz. This is the worst crisis we have ever faced," Sethi said....
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