The government is likely to take more measures to address the challenges faced by the exporters and freighters on increased freight costs, said a source from the Ministry aware of the matter. Also, the source confirmed that the government will also likely take measures to bring some relief in terms of rising insurance premiums.
“Customs duties have been tweaked after the war began to ensure availability of petrochemical products. We also aim to address concerns on increased freight costs due to diversion of exports via longer routes. We are also considering some relief on the insurance front too,” said an official aware of the matter.
There has been a massive surge in shipping costs with freight rates rising over 200-300% and war risk insurance premiums spiking. According to exporters and freight forwarders, several shipping companies and ports have imposed a War Risk Surcharge (WRS) ranging from $500 to $4,000 for cargo moving to and from the Upper Gulf, Arabian Gulf and Persian Gulf due to disruptions around the Strait of Hormuz.
The Centre has started taking measures to mitigate the economic fallout of the ongoing West Asia crisis, with a focus on ensuring supply stability and easing cost pressures on industry. To help exporters mitigate the risk Commerce Ministry launched the RELIEF (Resilience & Logistics Intervention for Export Facilitation) scheme, a Rs 497 crore initiative to support Indian exporters with increased ECGC risk coverage (up to 95-100%) and partial reimbursement (50%) for increased freight costs to impacted exporters and MSMEs from March to June 2026.
On Thursday, the Ministry of Finance announced a full Customs Duty exemption on critical petrochemical products till June 30, 2026. The move aims to ensure continued availability of critical petrochemical inputs for the domestic industry, reduce cost pressures on downstream sectors, and safeguard supply stability in the country.
Officials assured that several ministries are closely monitoring the impact of the ongoing crisis and adequate measures will be taken to ensure that higher logistics costs do not significantly erode export competitiveness. It has been assured that the Ministry of Commerce will come up with more export incentive schemes to ensure that the Indian exporters are least affected due to the ongoing West Asia crisis.