Tirupur’s textile exports stuck in Dubai due to war with Iran: threat of job and economic loss
Tamil Nadu: The war with Iran has left Tirupur’s knitwear exports stranded in Dubai, threatening jobs and economic losses.
Israeli and US forces recently launched a military offensive against Iran. Following this attack, Iran has been carrying out serious attacks on Gulf countries where US bases are located, including the United Arab Emirates (Dubai), Qatar, Kuwait, and Bahrain. This has caused significant disruptions to sea and air traffic.
K.M. Subramaniam, President of the Tirupur Exporters Association, said:
Most of India’s cargo is shipped to Dubai and back. Air freight is rarely used for exports because it is expensive. In this context, the war has created tensions in the Strait of Hormuz and Bab-el-Mandeb, which are crucial sea routes. Instead of going through the Suez Canal, ships are choosing to go around Africa. This has increased the travel time by 15 to 20 days. Due to the reduced traffic, it’s highly likely that a large amount of cargo already shipped there is also stranded.
Major shipping companies like Moersk MSC and Hapac have temporarily suspended service on this route. Shipping companies have begun imposing wartime surcharges, which translate into an additional cost of ₹150,000 to ₹300,000 per container in Indian currency. This will increase transportation costs by 20 to 50 percent. Similarly, in air transport, Air India, IndiGo, and foreign carriers like Emirates and Qatar Airways have temporarily canceled their flights to Gulf countries.
The airspace of Iran, Israel, Lebanon, Iraq, and Jordan is unusable. This has increased travel times for Indian flights to Europe and the US, forcing them to be diverted. Major airports and ports like Dubai are also severely affected. Even if duty-free trade agreements are successful, the lockdown will still cause significant economic losses and job losses.
Furthermore, since Dubai is a hub for Indian exports, the war tensions threaten to block large quantities of goods in pipelines, where goods transported from India are stored and shipped to various countries. He stated that the full extent of the stranded goods and the impact of the war will be fully known in the next few weeks. The Indian government is holding emergency meetings to mitigate losses. Until the situation improves, exporters have been advised to export on a buyer-pay basis when entering into new export contracts. It’s worth noting that not only the knitwear sector but also agricultural product exports have been severely affected.
