The International trade experts said the conflict may reduce the profits of domestic exporters but will not impact trade volumes unless war escalates. “For merchandise exports of India, the war may lead to higher insurance premiums and shipping costs. India’s ECGC may charge higher risk premiums from Indian firms exporting to Israel,” think tank Global Trade Research Initiative (GTRI) said.
Trade may be seriously impacted if operations at the three largest ports of Israel- Haifa, Ashdod and Eilat are disrupted. These ports handle shipments of agricultural products, chemicals, electronics, machinery, and vehicles.
India’s merchandise trade with Israel happens mostly through Eilat port, located on the Red Sea. Fortunately, so far there is no report of port disruption. India-Israel bilateral services trade is estimated to be around USD 1.3 billion. It may have no impact unless war escalates to involve bigger parts of Israel. The real impact would depend on the duration and intensity of the war.
