The old supply chain playbook - cheapest crude, fastest route, thinnest inventory - has been torn up. March 2026 was the first real stress test. India’s goods exports fell to $38.92 billion, down 7.4% year-on-year. Crude imports alone dropped 36% to $12.18 billion. Exports to the Middle East fell by roughly $3.5 billion in a single month. This matters: India imports over 80% of its crude and around 60% of its liquified petroleum gas, with nearly 90% of LPG and 69% of liquified natural gas routed through the Strait of Hormuz.

Brent - the benchmark for petroleum prices - moved from $69 to $113 per barrel within a month. The Indian government diverted propane and butane away from petrochemicals toward cooking fuel. Petrochemical units took an estimated 35% hit. Bloomberg reported India lost roughly 800,000 tons from its typical 2.6 million-ton monthly urea output. Around 80% of Gulf ammonia imports were disrupted, forcing companies like Alkyl Amines Chemicals and Balaji Amines to halt operations. Urea prices jumped from $482 to $720 per ton.

Freight rates soared. Rates on India-Europe routes ran 40–50% higher than earlier in the year. The Freightos Baltic Index jumped 23% in a single week. Carriers added fuel surcharges and war-risk premiums of $1,500–$3,000 per container. Vessel war-risk insurance premiums rose from roughly 0.25% to as high as 5–10% of vessel value. Cape of Good Hope rerouting added 10–20 days, stretching typical India-Europe voyages from 20 days to 30–40 days.

The strain surfaced most visibly at India’s ports. At peak disruption, around 20,000 Middle East-bound containers sat stuck at Deendayal Port and JNPT. Deendayal alone held 15,000 TEUs idle; Jawaharlal Nehru Port another 5,000, including reefers that needed continuous power just to stay usable. Nearly 400,000 tons of basmati rice waited at the dock, and about 300,000 tons of sulphur, gypsum, and other bulk imports didn't arrive on time.

Ports are a critical choke port: factories, exporters, and local supply chains all start backing up behind it. By mid-April, about 90% of the backlog had been cleared, but only through emergency intervention: waived storage charges, extended dwell times, and cargo rerouted through Fujairah, Muscat, and Salalah.

Over 60% of India’s DAP fertilizer imports, mostly from the Gulf, were delayed just ahead of Kharif sowing. This planting season generally occurs at the beginning of the southwest monsoon. Electronics exports to Gulf markets, roughly $4.5 billion annually, were rerouted at much higher cost. Downstream, packaging films, plastics, synthetic textiles, and pharmaceutical intermediates all felt the petrochemical feedstock squeeze. What began as an energy disruption quickly became a multi-industry production constraint.

Oil imports have resumed from the Russian Urals at around 155,000 barrels per day after a January pause. Oil imports from newer geographies - Canadian Western Select via the Trans Mountain pipeline, Brazilian and Guyanese offshore barrels - are entering the Indian basket at meaningful volume for the first time.

COVID taught companies about the risks of just-in-time, lean buffers, based on single-source optimization. These lessons are being reinforced. Companies are now building “a just-in-case supplier and logistics network” according to Umang Shukla, the CEO of Edgistify.

Edgistify is one of India’s largest third-party logistics firms. “For two decades," Mr. Shukla continued, "we optimized for peace. The 90% Gulf LPG dependency, the single-tier refining configurations, the Suez-Hormuz routing baked into every procurement contract; these were engineering choices that treated geopolitical stability as infrastructure rather than as a variable.”

Mr. Shukla believes many changes are necessary. “The companies adapting fastest aren't just finding alternative suppliers; they are rebuilding their decision architecture. They are pricing geopolitical risk into the base case, not the tail case.”

Further, “for mid-sized brands resilience has to come from software rather than scale, real-time visibility into every SKU’s upstream exposure, pre-qualified secondary suppliers, and the ability to swap vendors without breaking fulfillment service level agreements. The top 2% of Indian companies have sovereign-level hedging options. The remaining 98% need systems.”

Mr. Shukla concluded by saying, “The Red Sea, the South China Sea, and the Strait of Malacca each carry their own version of the same risk. Indian supply chains don't need more luck. They need better operating systems. Right now, resilience isn't a backup plan; it is how the system works.”