India's risks in the Iran conflict go way beyond oil

PAST CONFLICTS IN West Asia typically hit India at the gas station.

- ANDY MUKHERJEE

This time, the risks transcend oil, threatening everything from smartphone exports to New Delhi’s fragile finances.

Flames have reached the United Arab Emirates, India’s second-largest electronics export destination after the US. Beyond being an entrepot for regional trade, Dubai and Abu Dhabi are wealth hubs for the Indian elite. Additionally, nine million Indians work in the Persian Gulf, providing critical remittances. As Iran vows retribution for the killing of Ayatollah Ali Khamenei by the US and Israel, both migrant labourers and affluent professionals are on edge.

Oil trade through the Strait of Hormuz — conduit for half of India’s energy imports — is at a standstill. A prolonged blockade could widen the current account deficit and ignite inflation. Shipping channels are increasingly perilous; after missile or drone debris caused fires at Dubai’s Jebel Ali berths, an association of Indian rice exporters warned of soaring freight and insurance costs.