India’s exports to West Asia were hit hard during the conflict, with March exports to the region falling 57.95% to $3.5 billion
Experts said reopening the Strait of Hormuz could stabilise oil and gas prices, strengthen the rupee, and ease inflation risks
Exporters said the peace deal may create new business opportunities and support a stronger trade outlook for India
The announcement that the US and Iran have finalised a deal to end their 107-day conflict and reopen the Strait of Hormuz is expected to boost India's exports to West Asia, which was severely impacted by the hostilities, spur manufacturing activity and help stabilise the rupee, according to exporters and experts.
They said the announcement, if implemented successfully, would reduce pressure on India's import bill, ease inflationary covers and create a more conducive environment for trade.
The peace agreement would be signed on June 19 in Switzerland.
1 June 2026
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The US and Iran have reached a peace deal to end a four-month war that disrupted global energy supplies, pushed oil prices above $100 per barrel, and brought the Middle East to the brink of a wider regional conflict.
For India, which relies heavily on West Asia for crude oil, LPG and LNG supplies, the deal promises relief from high energy prices, pressure on the rupee, and inflation risks that intensified during the conflict, economic think tank GTRI said.
"For India, the agreement brings immediate economic relief as the conflict has exposed India's dependence on West Asia, from where it sources roughly 50% of its crude oil imports, around 70% of its LPG supplies and nearly 90% of its LNG imports," GTRI Founder Ajay Srivastava said.
The disruption of shipping through the Gulf raised India's energy import bill, increased inflation risks, weakened the rupee and forced refiners to seek alternative supplies from distant markets.
Reopening the Strait of Hormuz is expected to stabilise energy markets, ease pressure on oil and gas prices, strengthen the rupee and improve India's growth outlook, he said.
Mumbai-based exporter and Founder Chairman, Technocraft Industries India, Sharad Kumar Saraf said the announcement paves way for the end of uncertainties, economic slow down and unwarranted hardships.
"The end of war and hostilities will not only help in quantum jump in India's exports but will throw open a host of new business opportunities. Next 2-3 years will accelerate India's efforts for a Viksit Bharat," he said.
Federation of Indian Export Organisations (FIEO) President S C Ralhan said any easing of geopolitical tensions in the region should help restore normalcy in global energy supplies and moderate prices.
"For India, this would reduce pressure on the import bill, normalise exports, support rupee stability, ease inflationary concerns, and create a more conducive environment for trade and economic growth," he said.
Experts also said opening the Strait of Hormuz would help smoothen the movement of ships in international waters. The closure has led to an increase in insurance and freight rates. Ships are carrying goods from the Cape of Good Hope, encircling Africa, which has increased the delivery time of consignments.
INDIA-WEST ASIA TRADE The war (started has severely affected India's exports and imports with that region. All six members (UAE, Oman, Qatar, Saudi Arabia, Bahrain, and Kuwait) of the region are key trading partners of India.
The conflict began on February 28 when the US and Israel jointly launched military operations against Iran over its nuclear programme.
Due to this, India's exports posted the steepest fall in five months, declining 7.44% in March to $38.92 billion.
India's exports to the Middle East or West Asia region fell 57.95% to $3.5 billion in March, while imports from the Gulf nations fell 51.64%. Normally India exports goods worth about $6 billion to this region.
India's exports to the GCC (Gulf Cooperation Council) grew about 1% to about $57 billion in 2024-25 against $56.32 billion in 2023-24. Imports rose 15.33% to $121.7 billion in 2024-25 from $105.5 billion in 2023-24.
The UAE was India's third-largest trading partner in 2025-26. India's exports to the nation rose about 2% to $37.4 billion in 2025-26, while imports were up 0.78% $63.9 billion in the last fiscal year, resulting in a trade deficit of $26.53 billion in 2025-26.
Saudi Arabia was India's fifth-largest trading partner during the last fiscal year. Exports to the kingdom dipped 12.55% to $110.28 billion in 2025-26, while imports were up 2.22% to $30.8 billion, leading to a trade deficit of $20.5 billion in 2025-26.
Exports to Qatar dip 3.7% to $1.62 billion last fiscal year, while imports declined 1.37% to $12.3 billion, resulting in a trade deficit of $10.7 billion in 2025-26.
Shipments to Oman dipped 1% to $4.02 billion in 2025-26, while imports were up 9.43% to $7.16 billion. The trade deficit was 3.14 billion.
Exports to Kuwait dipped 14.63% to $1.65 billion, while imports were down 4.4% to $7.91 billion, leading to a trade deficit of $6.26 billion.
Similarly, India's outbound shipments to Bahrain were down 2.32% in the last fiscal year to $779 million in the last fiscal year. Imports were up 5.25% to $887.76 million, leaving a trade deficit of $108.78 million.
India's key exports to GCC 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 country's major imports include comprise crude oil, liquefied natural gas (LNG), liquefied petroleum gas (LPG), petrochemicals, fertilisers, plastics, aluminium and other mineral fuels.
