Hormuz choke continues to impact India

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WHAT WE’RE TRACKING TODAY

India plans export-linked smartphone subsidy scheme

Good afternoon, readers, and happy weekend. The toll of war continues to dominate national and global headlines, with an off-ramp not in near sight.

India has secured an extension on a sanction waiver to buy Russian crude, even as refiners are seeking to bypass the Strait of Hormuz via Saudi Arabia’s west coast. Diplomatic efforts to pressure Iran to allow Iran-bound shipments through the strait have gathered steam, however, without a definitive breakthrough.

Watch this space

MANUFACTURING — India is drafting a second phase of smartphone manufacturing incentives that would tie government subsidies to exports and deeper local sourcing, Bloomberg reports, citing unnamed sources.

The plan would replace the current incentive scheme for handsets assembling, which expires at the end of March and primarily rewards incremental domestic output. The next phase aims to encourage companies to increase exports while integrating locally produced components into the supply chain.

Remember: The value of iPhones shipped from India in 2025 was USD 50 bn. Apple also announced plans to assemble and package iPhone chips in India last year.

Why it matters: The policy underlines the growing role of Apple and its suppliers in transforming India into a major smartphone export hub. Contract manufacturers assembling iPhones account for roughly three-quarters of India’s handset exports. New Delhi is seeking to encourage brands such as Samsung, Oppo and Xiaomi to replicate Apple’s model in India. India will soon emerge as a key source of smartphone and electronics imports for the MENA region.

Beyond assembly: A key proposal under discussion is to link subsidies to the amount of components sourced within India. Manufacturers using locally produced parts — such as display modules, camera assemblies and other sub-components — and export finished smartphones would qualify for the highest incentives. This is part of New Delhi’s push to move beyond simple assembly and build a stronger domestic electronics supply chain.

LOGISTICS — The first India destined ship to cross the Strait of Hormuz since the US-Israel strikes on Iran carried crude oil from Saudi Arabia and docked at the Mumbai port. The Liberia-flagged Suezmax Shenlong arrived on Wednesday with about 135k metric tonnes of crude bound for refineries along the western coast, News on Air reports.

Transit under risk: The vessel temporarily turned off its automatic identification system, a step sometimes taken by tankers navigating high-risk waters. The ship later reappeared on tracking systems and completed its voyage. The passage indicates a rare transit of oil through Hormuz that carries roughly a fifth of global crude trade and remains critical for India’s energy security.

What we know so far: According to India’s shipping ministry, 28 Indian-flagged vessels are currently stranded in the Persian Gulf. Of these, 24 ships carrying 677 Indian seafarers are positioned west of the Strait of Hormuz, while four vessels with 101 Indian crew members are located east of the Strait.

CURRENCY — The INR fell to a record low of INR 92.43 per USD on Friday, breaching its previous low of INR 92.36 per USD. The currency has weakened 1.5% since the conflict started, despite intervention by the Reserve Bank of India (RBI) across spot and derivatives markets. Further weakening toward INR 94-95 per USD if oil prices remain elevated, Reuters reports citing analysts and traders.

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The big story abroad

It’s a mixed bag in the global business press this morning, but most news outlets are looking at oil prices, which have refused to let up after both US President Donald Trump and new Iranian Supreme Leader Mojtaba Khamenei struck a defiant tone in separate statements yesterday, giving no hints of a near end to the war.

Khamenei made his first public statement since his appointment, and his message was: he plans to ensure the Strait of Hormuz will remain effectively closed, and that if the US and Israel continue their attacks, Iran would open up new fronts in the war.

Meanwhile, Trump shrugged off rising oil prices, saying that preventing Iran from having nuclear weapons “of far greater interest and importance to me” in a social media post. Still, the US eased restrictions on Russian oil in what seems like a move to help ease prices, allowing companies to buy Russian oil stranded at sea.

Also getting attention: A US refueling military aircraft crashed in Iraq. It’s not clear yet whether the three-man crew was injured or killed.

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Check out our full calendar on the web for a comprehensive listing of upcoming news events, national holidays and news triggers.

India turns to new suppliers to plug cooking gas gaps

India is expanding liquefied petroleum gas (LPG) procurement beyond the Gulf, securing cargoes from the US, Norway, Canada and Russia, India’s Petroleum and Natural Gas Minister, Hardeep Singh Puri said in a press briefing. The world’s second-largest LPG importer, is seeking to stabilize supplies after continued disruptions to Gulf shipping routes.

Gas remains India’s Achilles’ heel: The minister claimed that domestic cooking gas supply remains stable, however, panic buying and shortages have been widely reported. Emergency measures were invoked requiring refiners to maximise LPG output, limit sales to industrial users and safeguard supplies for households. The Environment Ministry has in the meantime allowed temporary use of alternative fuels like biomass, kerosene and coal in restaurants and hotels to ease demand pressures.

Crude supply is secure, for now: India has diversified crude oil imports so that roughly 70% volumes now bypass the Strait of Hormuz, reducing exposure to shipping disruptions, the minister claimed. However, India lacks the strategic storage to weather a prolonged blockade of Hormuz.

Meanwhile- Gas Authority of India has secured a liquefied natural gas (LNG) shipment from Oman, Reuters reports, citing unnamed sources. The cargo, purchased from a European trader, was priced at a steep USD 17-20 per MMBtu and is scheduled to arrive in India next week, the newswire added. The purchase indicates that India is turning to high-priced spot cargoes to bridge emergency supply gaps as Gulf flows remain uncertain.

Cooking gas prices hiked

The government has raised the price of the 14.2 kg household LPG cylinder by about 7%—the first revision in nearly a year—due to tighter availability, Bloomberg reports. Prices for subsidized cylinders were increased by 11%. The government's halt of LPG supplies for commercial use has driven some businesses to informal markets, where commercial cylinders are sold at a price hike of up to 18%.

Induction stove sales surge

Indian households are increasingly turning to electric induction stoves as concerns over cooking gas availability drive a surge in demand, Reuters reports. Several models were unavailable on online platforms as electric stove sales on Amazon India rose more than 30-fold. Kitchen appliance maker TTK Prestige says demand has roughly tripled, prompting the company to raise plant utilization to 100% from about 70% and increase staffing by around 15%.

US throws oil markets a lifeline

The US Treasury Department has extended a temporary authorization allowing countries to purchase Russian crude cargoes already in transit, Treasury Secretary Scott Bessent said on X. The measure applies only to oil already at sea and is intended as a short-term step to expand available supply in global markets amid heightened geopolitical tensions.

The authorization covers shipments loaded before 12 March, broadening a waiver previously granted to India that allowed buyers to receive cargoes loaded before 5 March, Bloomberg reports. The decision allows purchasers to complete deliveries of crude already in transit without extending the exemption to new shipments.

Market context: The move comes as governments monitor energy market volatility linked to tensions in the Middle East and risks to global supply routes. Brent crude was trading near USD 100 per barrel in early Asia trading, reflecting continued uncertainty in oil markets.

Why it matters: India’s purchases of Russian crude in March have witnessed a 50% uptick to 1.5 mn bbl/ d as refiners secure alternative feedstock. Diversifying supply is only a short-term hedge against geopolitical shocks impacting Gulf imports as Russian crude flows can partially offset disruptions.

Bypassing Hormuz not enough

Rerouting oil imports: Indian refiners have stepped up crude imports through Saudi Arabia’s Red Sea port of Yanbu and the UAE's Fujairah route to bypass Strait of Hormuz, Moneycontrol reports, citing shipping and commodity tracking data. Both locations are linked to pipelines that allow crude exports to bypass the Hormuz Strait.

Shipment volumes:

Yanbu, Saudi Arabia: Shipments to India reached about 8.8 million barrels (mn bbl) so far this month, after previously being minimal. Another 4.2 mn bbl are scheduled for April.
Fujairah, UAE: Shipments totaled about 4.3 mn bbl so far this month.

Sound smart: Saudi Aramco operates the East-West pipeline, which can transport about 5 mn bbl / d from eastern oil fields to Yanbu on the Red Sea. The Abu Dhabi National Oil Company (ADNOC) operates the Habshan-Fujairah pipeline, capable of moving about 1.5 mn bbl / d from Abu Dhabi’s oil fields to the Gulf of Oman.

Capacity constraints: The pipeline capacity cannot fully replace the 2.5-2.7 mn bbl/day India previously imported through the Strait of Hormuz — imports from the Gulf are estimated at only one-third of normal levels, even with the rerouting, according to the report.

War-driven supply shocks ripples downstream manufacturing

Energy disruptions will soon start impacting downstream sectors in India: The energy disruptions and escalating shipping risks are starting to impact India’s downstream economy, driving up petrochemical and logistics costs that are poised to inflate prices for consumer paints and essential medical devices.

Medical devices exposed to higher input costs

India’s medical device manufacturers are facing rising input costs due to a global tightening of polypropylene supplies while prices have increased by up to 30%. Economic Times reports. The price of this thermoplastic polymer, vital for syringes, IV bags, and catheters, has surged, straining producers of low-margin medical consumables.

Smaller manufacturers, which dominate the Indian market, are especially vulnerable to volatile raw material costs and energy shortages. Gas rationing has reduced production profitability, forcing some factories to consider switching to more expensive fuels. Protracted logistics or energy issues could increase hospital procurement costs and delay deliveries of essential medical disposables.

Paint may get costlier

Rising crude oil prices are beginning to affect India's consumer manufacturing supply chains. Specifically, coating producers, who rely heavily on petrochemical derivatives, may raise paint prices by up to 5% if oil markets remain elevated, according to an ANI report, citing Systematix Research. Companies may pass some of this cost pressure onto consumers, but final pricing will depend on oil trends and market competition.

Ins. firms reassess exposure

Indian insurers are reassessing marine cargo exposure and war risks for shipments routed through Gulf trade lanes, Economic Times reports. Mumbai-based private-sector insurer ICICI Lombard General Ins. has introduced a war-risk-premium of about 0.25% on cargo policies covering shipments linked to Gulf countries.

Exposure review: Insurers are compiling shipment-level information — including cargo value, vessel details, loading and discharge ports, and vessel location — to assess potential exposure to war-related risks. ICICI has not withdrawn war-risk coverage under existing policies and continues to operate within standard contractual and sanctions-related conditions. However, cargo movements linked to Israel will be subject to additional internal clearance depending on developments in the region.

India steps up pressure on Iran

India presses for safety of ships and energy security with Iran: Prime Minister Narendra Modi spoke with Iranian President Masoud Pezeshkian emphasizing that the safety of Indian nationals, the uninterrupted transit of goods and energy remain India’s priorities, as per a post on X. This was Modi's first conversation with Iran’s leadership and came hours after India’s External Affairs Minister spoke with his counterpart.

External Affairs Minister S. Jaishankar and Iranian Foreign Minister Seyed Abbas Araghchi have held multiple conversations in recent days, with their latest exchange focusing on maritime shipping safety and India’s energy security, according to India’s Ministry of External Affairs.

Diverging views? Iran’s foreign ministry maintained that disruptions to shipping in the Gulf were the result of what Tehran described as “aggressive and destabilising actions” by the US.

Why it matters: The back to back outreach comes as New Delhi engages Tehran on ensuring the movement of vessels through the Strait of Hormuz, with officials seeking to secure passage for tankers carrying crude oil, LPG and LNG bound for Indian buyers. India says it would be “premature” to comment on reports that India has secured permission for its ships to cross the Strait of Hormuz.

Consular monitoring: New Delhi is also tracking the safety of Indian nationals in Iran. Around 9k Indians — including students, seafarers, businesspeople, professionals and pilgrims — are currently in the country. India has relocated several citizens from Iran to safer locations via land routes crossing into Azerbaijan and Armenia, from where they can take commercial flights home.

KEC International bags T&D orders across regions

Mumbai-based infrastructure EPC firm KEC International has secured transmission and distribution and power infrastructure orders worth INR 14.76 bn (USD 178 mn) spanning India, the Middle East, Africa and the Americas, Economic Times reports. The orders include a composite project in Saudi Arabia covering 380 kV transmission lines, substations and extra-high-voltage cabling, along with a 132 kV transmission line project in Africa.

GCC debt markets hit the brakes as geopolitical risk spikes

GCC borrowers have effectively frozen new USD bond and sukuk sales as regional markets price at a war premium following the outbreak of the conflict with Iran, Fitch Ratings says. After a record-breaking start to 2026, the regional pipeline is now on hold despite the total outstanding debt market hitting a record USD 1.2 tn this month — a 14% y-o-y increase.

REMEMBER- The GCC had significant funding needs going into 2026, as GCC governments and issuers look to diversify funding channels and refinance maturing debt. Regional debt markets had been on track to break the USD 1.25 tn mark this year, up from USD 1.1 tn in issuances last year, according to Fitch Ratings’ GCC Debt Capital Markets MENA Monitor 2026 report (pdf).

Why it matters: The GCC now accounts for 40% of all emerging-market USD issuance (excluding China), making it the primary engine of EM debt. While yields widened 28-32 bps in the conflict’s first ten days, CDS remained remarkably resilient, widening by only 13 bps for Abu Dhabi and 12 bps for Saudi Arabia, according to a Mashreq Capital note (pdf).

Real estate among the first to show signs of trouble: “While higher-quality sovereign and quasi-sovereign credits continue to trade in an orderly manner, weaker high-yield issuers, particularly in real estate, have seen a marked deterioration in market depth,” Mashreq Capital notes, citing bid-ask spreads that have widened to around 2 points versus the usual 0.5, pointing to limited buyer appetite.

Sukuk continues to offer a volatility hedge: Heavy demand from Islamic banks is keeping sukuk spreads tighter than conventional bonds, giving regional issuers a pricing edge even as high-yield benchmarks (like the S&P High Yield Sukuk Index) see yields rise toward 6.61%.

Looking ahead, Mashreq Capital sees three potential scenarios: A diplomatic de-escalation could quickly unwind the war premium, tightening spreads and reopening the issuance window, according to Mashreq Capital. A more prolonged standoff would likely keep spreads elevated and push CDS ins. costs higher, effectively raising borrowing costs for regional issuers. In a worst-case scenario, markets could face a broader liquidity shock, forcing selloffs even in high-quality sovereign debt.

MARKETS THIS MORNING

Asian markets took a tumble this morning as oil prices remained elevated and comments from US President Donald Trump and Iran’s new supreme leader, Mojtaba Khamenei, gave little hope for a near end to the war. Honda’s shares fell over 6%, dragging Japan’s Nikkei down 2%, after the automaker said it expects its first annual loss in almost 70 years. South Korea’s Kospi was also down almost 3%, while Hong Kong’s Hang Seng was also down in early trading.

Wall Street futures, meanwhile, were slightly higher as investors await US inflation data later today.

Sensex	74,779	-1.6% (YTD: -11.5%)
NIFTY 50	23,211	-1.8% (YTD: -10.6%)
ADX	9,472	-1.6% (YTD: -3.5%)
DFM	5,405	-2.05% (YTD: -8.7%)
Tadawul	10,893	-0.4% (YTD: +3.8%)
EGX30	46,790	-0.8% (YTD: +11.8%)
Boursa Kuwait	7,998	+0.1% (YTD: -3.6%)
QSE	10,485	-0.8% (YTD: -2.5%)
S&P 500	6,672	-1.5% (YTD: -2.5%)
FTSE 100	10,246	-0.5% (YTD: +3.7%)
Euro Stoxx 50	5,705	-0.7% (YTD: -0.7%)
Brent crude	USD 101	+0.5%
Natural gas (Nymex)	USD 3.22	-0.3%
Gold	USD 5,087	+0.1%
BTC	USD 71,889	+2.7%

The values in the table above are listed according to the market position as of 3:30pm IST / 2pm GST.

CALENDAR

MARCH

19-22 March (Thursday-Sunday): Bharat Urja Manthan - Global Energy Conclave, New Delhi.

20 March (Friday): Eid Ul-Fitr.

23-25 March (Monday-Wednesday): Indiasoft 2026: International IT Exhibition & Conference, New Delhi

23-25 March (Monday-Wednesday): Smart Cities Expo, Bharat Mandapam, New Delhi.

23-25 March (Monday-Wednesday): PLASTIWORLD India 2026, Jio World Convention Centre, Mumbai.

27-29 March (Friday-Sunday): Vizag International SME Business Expo, Visakhapatnam, Andhra Pradesh.

31 March (Tuesday): Mahavir Jayanti.

Signposted to happen sometime in March 2026

Election Commission of India is expected to announce polling dates for elections in the states of Tamil Nadu, Kerala, West Bengal, Assam, and the union territory, Puducherry.

APRIL

3 April (Friday): Good Friday.

6-8 April (Monday-Wednesday): Reserve Bank of India’s Monetary Policy Committee Meeting

7-10 April (Tuesday-Friday), India Rubber Expo 2026, ITPO, Pragati Maidan, Delhi.

16-17 April (Thursday-Friday): Entrepreneur Tech & Innovation Summit 2026, Bengaluru.

22-24 April (Wednesday-Friday): RenewX 2026, Chennai Trade Centre, Chennai.

23-25 April (Thursday-Saturday): Rail & Metro Technology Conclave 2025, Bharat Mandapam, New Delhi.

29 April-2 May (Wednesday-Saturday): Bharat Buildcon 2026, Yashobhoomi, Dwarka, Delhi.

MAY

29 April-2 May (Wednesday-Saturday): Bharat Buildcon 2026, Yashobhoomi, Dwarka, Delhi.

1 May (Friday): Buddha Purnima.

26 May (Tuesday): Eid Ul-Adha.

JUNE

24-25 June (Wednesday-Thursday): India Homeland Security Expo 2026, Bharat Mandapam, Pragati Maidan, New Delhi.

26 June (Friday): Muharram.

Signposted to happen sometime in 1H 2026:

Signing of India-Qatar Free Trade Agreement (Details yet to be announced).
India-EU Trade and Technology Council Ministerial Meeting 2026, Brussels, Belgium.
India to host the BRICS Summit.

JULY

1-3 July (Wednesday-Friday): Seafood Expo Bharat 2026, Chennai Trade Centre, Chennai.

3-4 July (Friday-Saturday): Rail & Transit Expo (RailTrans) 2026, Bharat Mandapam, New Delhi

8-10 July (Wednesday-Friday): India Energy Storage Week 2026, New Delhi.

14-17 July (Tuesday-Friday) Bharat Tex 2026, New Delhi.

AUGUST

15 August (Saturday): Independence Day.

26 August (Wednesday): Prophet Mohammad’s Birthday.

SEPTEMBER

1-3 September (Tuesday-Thursday): India Energy Week, Dwarka, New Delhi.

8-11 September (Tuesday-Friday): Global Fintech Fest 2026, Mumbai.

17-19 September (Thursday-Saturday) : Semicon India Conference 2026, Yashobhoomi, Delhi.

OCTOBER

2 October (Friday): Gandhi Jayanti (Mahatma Gandhi’s Birthday).

20 October (Tuesday): Dussehra.

NOVEMBER

24 November (Tuesday): Guru Nanak Jayanti.

DECEMBER

8-11 December (Tuesday-Thursday), Expand North Star 2026, Dubai.

25 December (Friday): Christmas Day.

Signposted to happen sometime in 2H 2026:

Monsoon Session of Parliament, New Delhi is expected to be held between July-August. Dates yet to be announced.
Reserve Bank of India’s Monetary Policy Committee meeting for the September cycle. Dates yet to be announced.
India Mobile Congress 2026, New Delhi will likely be held in October. Dates yet to be announced.

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