In this episode of the State of the Economy Podcast, Amiti Sen speak to Ajay Srivastava, former Indian Trade Service Officer and Co-founder of the Global Trade Research Initiative, to know more about the escalating Red Sea crisis and its implications for India and the world. 

Since November 2023, Yemen-based Houthi militia have targeted cargo ships in the Red Sea, claiming solidarity with Palestinians in Gaza.

As tensions rise, 95% of vessels have rerouted around the Cape of Good Hope, adding 4000 to 5000 nautical miles and 15 to 20 days to journeys. The implications are far-reaching, impacting freight costs, delayed deliveries, and potentially disrupting global supply chains. 

The sectors hit hardest, including refined petroleum, chemicals, plastics, and basmati rice. The rerouting affects 20-25% of India’s total merchandise trade, particularly impacting cargo bound for Europe, the US East Coast, North Africa, and Russia. 

The podcast looks at the complexities and uncertainties surrounding crude oil imports, focusing on potential impacts on prices and alternatives. 

The podcast ends with a stark reminder of the uncertainties surrounding the Red Sea crisis. Will tensions escalate or de-escalate? Stay tuned for further developments. 

Host: Amiti Sen, Producer: Siddharth Mathew.

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About the State of the Economy podcast 

India’s economy has been hailed as a bright spot amid the general gloom that seems to have enveloped the rest of the world. But several sectors continue to stutter even as others seem set to fire on all cylinders. To help you make sense of the bundle of contradictions that the country is, businessline brings you podcasts with experts ranging from finance and marketing to technology and start-ups 

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