Durable US-Iran Peace Deal to Provide Predictable Environment for Trade: CRF

• CRF said a durable US-Iran peace deal could improve the trade and investment climate across West Asia

• It said lower shipping disruption would reduce freight, insurance and logistics costs for Indian exporters

• India’s exports to the GCC nations fell 2% to $55.71 billion in 2025-26

A sustained US-Iran peace deal would promote greater regional stability, helping Indian exporters through lower freight, insurance and logistics costs, while providing a more predictable environment for trade, think tank CRF said on Tuesday.

Chintan Research Foundation (CRF) President Shishir Priyadarshi said that a durable US-Iran peace agreement has the potential to significantly improve the trade and investment climate across West Asia by reducing one of the region's biggest geopolitical risks.

"For India, the benefits extend beyond lower energy price volatility. Greater regional stability would improve shipping confidence, reduce insurance and logistics costs, strengthen connectivity initiatives such as IMEC ( India-Middle East-Europe Economic Corridor), and create a more predictable environment for trade with the Gulf and the wider Middle East," he said.

US President Donald Trump has announced that the US and Iran have finalised a deal to end their 107-day war, which triggered a global energy crisis. The peace agreement is scheduled to be signed on June 19 in Switzerland, according to Pakistan Prime Minister Shehbaz Sharif.

Priyadarshi said the agreement is important as geopolitical stability acts as a strong catalyst for trade facilitation.

The leaders of India, European Union, France, Germany, Italy, Saudi Arabia, UAE and US announced an MOU on September 9, 2023 on the sidelines of the G20 Leaders’ Summit committing to work together to develop a new IMEC.

The IMEC will comprise two separate corridors, the east corridor connecting India to the Gulf and northern corridor connecting Gulf to Europe.

The US-Iran conflict has severely disrupted movement of cargo ships across the Strait of Hormuz, a key narrow passage between Iran and Oman that handles roughly a fifth of global oil consumption and serves as the primary export route for major Gulf producers, including Saudi Arabia, Iraq, Kuwait, the United Arab Emirates and Qatar - all key energy suppliers to India.

This disruption has led to an increase in crude oil prices, which was pushing inflation northwards. It has affected India's exports and imports to and from the West Asian region.

The main countries of this region include six GCC nations (Bahrain, Oman, Qatar, UAE, Kuwait, Saudi Arabia), Israel, Iran, Iraq, Jordan, Lebanon, Syria and Yemen.

India's exports to the GCC nations in 2025-26 dipped 2% year-on-year to $55.71 billion as against $56.87 billion in 2024-25.

The country's exports to other seven West Asian nations rose 2% to $12.61 billion last fiscal from about $13 billion in 2024-25.

On the other hand, India's imports from the GCC bloc in 2025-26 was up 1% year-on-year to $123 billion as against $121.7 billion in 2024-25.

The country's imports from the other seven West Asian nations, however, declined by 12.94% to $28.71 billion last fiscal from $32.98 billion in 2024-25.

India's key exports to these countries include engineering goods, refined petroleum products, food and agricultural products, cereals, rice, meat, marine products, gems and jewellery, chemicals, pharmaceuticals, textiles, and machinery.

The major imports include crude oil, Liquefied Natural Gas (LNG), Liquefied Petroleum Gas (LPG), petrochemicals, fertilisers, plastics, aluminium and other mineral fuels.