India’s freight forwarding industry is raising concerns over significant War Risk Surcharges (WRS) imposed by international shipping lines on cargo related to the Gulf region. The Federation of Freight Forwarders’ Associations in India (FFFAI) has formally requested intervention from the Ministry of Ports, Shipping and Waterways to address what it considers profiteering under geopolitical pretenses. Current WRS charges from major shipping lines range between $1,500 and $4,000 per container, adding financial strain to exporters already facing a 30-50% increase in base freight rates due to capacity shortages.
Approximately 70% of Indian exports have been disrupted, particularly affecting Gulf-bound cargo and transshipment traffic. The rice export sector has been hit especially hard, with over 3,000 containers stranded at Gulf ports or in transit. As the world’s largest rice exporter, India risks losing its position in critical markets like Saudi Arabia and the UAE due to these logistical disruptions.
In light of these challenges, the Commerce Ministry is considering a relief package for exporters, which may include extensions on export obligations and loan moratoriums. Industry bodies are urging swift action as the crisis enters its fourth week, emphasizing the shrinking window for effective intervention.
