Over 50% slump in India-Middle East trade

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WHAT WE’RE TRACKING TODAY

Air India seeks emergency funding; India’s urea prices near USD 1k per ton

A very good afternoon and happy FRIDAY to you all. We’re feeling cheery because today is very much a good news type of day.

Iran and the US seem likely to extend the ceasefire set to expire next Wednesday, with talks pointing to an extension that gives both sides time to iron out details for a comprehensive peace agreement. This coincides with Donald Trump’s announcement of a ceasefire in Lebanon which came into force at midnight local time.

While that could take months — maybe up to six, sources in the know say — it at least avoids a return to conflict and offers a glimmer of hope that an interim agreement over the Strait of Hormuz could come soon.

Global markets are cheering the news and feeling very optimistic — a bit too optimistic, policymakers say, as we write in today’s Planet Finance below.

The big story today: India’s merchandise trade with the Middle East declined by over 50% in March, highlighting the impact of the war on the MENA-India corridor. The country’s oil imports dipped by 36%, as did trade with the UAE, one of its largest import sources.

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AVIATION — Air India seeks bailout from investors: India’s second-largest carrier Air India, is reaching out to its shareholders for a financial lifeline after recording a staggering INR 220 bn (USD 2.4 bn) annual loss in FY 2026 (ending 31 March), Bloomberg reports, citing unnamed sources.

Why it matters: With 16% of its capacity tied to the Middle East, the airline is bleeding money on longer, more expensive flight paths to avoid hostile routes. After a decade of losses, Air India’s path to operational break-even — originally targeted for this year — is pushed to 2027 or beyond.

What went wrong: The airline’s loss gap widened significantly beyond earlier internal estimates of USD 1.6 bn. This record deficit was fueled by a series of major setbacks, including the fatal crash of an Air India Boeing 787 Dreamliner in Ahmedabad in June 2025, the closure of Pakistani airspace to Indian carriers, and the ongoing fallout from the Middle East conflict.

What we know: The carrier’s parent Tata Group and minority investor Singapore Airlines — with a 25.1% stake — are discussing a capital injection, though the final size remains uncertain. The funding needs are exceeding what current investors are willing to commit, which could push the airline to seek alternative financing, the outlet added.

The bottom line: Despite rolling out ambitious fleet expansion plans, the legacy carrier has consistently struggled to improve service standards and lift yields to desired profitability levels.

TRADE — Fertilizer prices doubled? Global manufacturers are selling urea to Indian buyers at USD 1k per ton — nearly double the levels seen before the war, Reuters reports.

What we know: State-run buyer Indian Potash sought 2.5 mn tons of urea through global tenders, with a majority of supplier offers ranging between USD 1-1.1k per ton, while the lowest bid stood at USD 935 per ton for delivery to ports on the western coast.

Why it matters:India — the world’s largest buyer of urea — imports around 10 mtpa from Oman, Qatar, the UAE, Russia, and China. If the Indian buyers purchase the fertilizer at USD 1k per ton, the global spot market prices will remain elevated, pinching price-sensitive buyers in MENA and Asia. Moreover, persistently elevated costs will add to India’s subsidy burden, given that fertilizer prices for farmers are state-supported, resulting in a wider fiscal and current account deficit in the country.

COMMODITIES — The Multi Commodity Exchange of India will add 100g gold bars produced by UAE Good Delivery-accredited refineries to its list, state news agency Wam reports. The inclusion brings a UAE-origin certification system into India’s exchange-linked commodities market, with the UAE’s Good Delivery framework enhancing transparency and overall standards in the gold supply chain.

Why it matters:The move comes amid expanding bullion trade between the two countries following the India-UAE CEPA. Bilateral gold trade rose to USD 17 bn in 2025 from USD 3 bn in 2022. The change widens the pool of gold eligible for India’s exchange system and reflects the closer integration of India’s bullion market with refining and trading hubs in the Gulf.

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The big story abroad

The good news grabbing the attention of most business press this morning is the likelihood of an agreement between the US and Iran, and news of a 10-day ceasefire between Israel and Hezbollah. US President Donald Trump said things are “looking very good” for the countries to reach an agreement, and that talks are expected to resume soon. The last round of talks, which took place last weekend, had been inconclusive, with differences emerging over Iran’s nuclear program.

ALSO- Netflix’s earnings and the resignation of co-founder and chairman Reed Hastings are getting plenty of play. The streaming provider’s forecast for earnings growth fell short of analyst expectations, sending its shares tumbling 9% in after-hours trading.

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Iran war cripples India-Middle East trade

India’s trade with the Middle East plunged over 50% in March, with USD 3.5 bn in Indian exports to the region wiped out in March due to the Iran war and blockade of the Strait of Hormuz, Economic Times reports, citing India’s Commerce Secretary Rajesh Agrawal. This decline came despite India’s merchandise trade deficit narrowing to a nine-month low of USD 20.6 bn in March, as strong demand from the US offset disruptions from the war, according to data from the Trade Ministry.

Why it matters: With annual India-Middle East trade valued at USD 178 bn, these early warning signs suggest global disruptions may continue through April. A persistent blockade of Hormuz has stirred up a war tax — with rising freight and ins. premiums — on India-Middle East trade as goods face longer transit times and uncertainty.

In value terms: Exports to the region fell 57.9%, while imports saw a 51.6% downturn. The slump in India’s monthly exports to the region — typically around USD 6 bn — impacted gems and jewelry, engineering goods, electronics, petroleum products, and food products.

Imports ease on lower oil, gold: India’s merchandise imports in March declined 6.5% m-o-m to USD 59.5 bn, driven by a USD 12.1 bn (36% y-o-y) dip in oil purchases and a 31.6% fall in gold imports as supplies from the Gulf remained constrained.

Oman featured among the top five import sources in March, marking an expansion of 112% y-o-y while displacing the UAE, which was the third-largest import source in February. This highlights the impact of the Hormuz blockade on India’s trade dynamics with the Gulf region.

MEANWHILE- India’s gems and jewelry exports to the UAE climbed 23.7% and to Hong Kong 33.5%, providing some relief. The sector’s total exports fell 3.3% y-o-y to USD 27.72 bn in FY 2026, their lowest in five years, according to a Gem and Jewellery Export Promotion Council press release (pdf).

US demand cushions shock: India’s total exports climbed to USD 38.9 bn, with US shipments jumping 17.4% m-o-m to USD 8 bn, on the back of tariff cuts boosting textile and engineering exports.

(** Tap or click the headline above to read this story with all of the links to our background and outside sources.)

US pulls the plug on India's Russian and Iranian oil waivers

The US will not renew temporary waivers that allowed India limited imports of Russian and Iranian crude, Treasury Secretary Scott Bessent said in a White House press briefing (watch, runtime: 41:19).

Waivers expire, supply clamped: Washington’s decision ends the short-term relief that had enabled buyers including India to purchase sanctioned crude already at sea.

Why it matters: Import-dependent economies like India had lobbied for an extension to offset disruptions to supplies from the GCC. Higher freight, ins. and crude prices are already feeding into fuel inflation across the country. While targeted exemptions remain possible, the US has not clarified if country-specific waivers will be granted.

IN CONTEXT- India’s crude imports from Russia surged nearly 150% in March following the waiver. Meanwhile, the first Iranian crude and LPG cargoes in almost seven years — since the 2019 US sanctions were imposed — arrived at Indian ports.

Hormuz compounds impact: The near paralysis of traffic through the Hormuz — through which about a fifth of global oil passes — is mounting supply risks for Indian refiners. A US blockade on Iranian supplies is further deterring shipments and removing barrels from the market.

Indian government expects bottlenecks to persist after the war

Disruptions to the global liquefied petroleum gas (LPG) supply chain could take three to four years to normalize, as uncertainty persists over damage to production and export infrastructure in the Middle East, Moneycontrol reports, citing a senior Indian government official. Even after rerouting shipments, supply disruption could remain at 40-50%, depending on the extent of damage to upstream infrastructure in the Gulf, analysts told the outlet.

REMEMBER- India meets about 60% of its LPG needs through imports, with the GCC historically accounting for the bulk of supply.

(** Tap or click the headline above to read this story with all of the links to our background and outside sources.)

War squeezes India’s tourism and hospitality sectors

Tourism inflows to India dropped by up to 20%, with leisure travel seeing the sharpest impact, as war in the Middle East disrupted flight networks and affected traveler sentiment, according to a PHD Chamber of Commerce and Industry report (pdf).

Why it matters: India’s long-haul air connectivity depends on Gulf carriers and transit hubs, which act as key gateways linking the country to major markets such as North America. Disruptions in these corridors are reducing seat availability and pushing up fares, creating access constraints for inbound travelers even while demand remains intact.

“The ongoing conflict in the Middle East has created immediate operational challenges for India’s aviation sector and the wider tourism ecosystem. Airspace restrictions, rising ATF prices, higher ins. premiums, and disruptions in transit routes through Middle Eastern hubs are beginning to impact international connectivity, travel costs, and tourism flows to India,” Indian Association of Tour Operators President Ravi Gosain said.

The disruption follows a V-shaped recovery for the sector in 2025. The tourism industry — which contributes nearly 8% to India’s GDP and supports over 40 mn jobs — saw its branded hotel inventory near 200k rooms and domestic aviation traffic cross 500k passengers daily before the war introduced fresh volatility earlier this year.

Aviation + hospitality bear the brunt

Airlines are taking the biggest hit: Flight cancellations, airspace closures, and the rerouting of international services have added two to four hours of flying time on routes through the Middle East. With aviation turbine fuel accounting for 35-40% of operating costs, airlines’ profitability is taking a significant hit amid reduced connectivity and surging airfares for consumers.

Margin squeeze hits hospitality and dining: Premium and business hotels that rely heavily on foreign travelers are seeing squeezed margins due to spiking energy and input prices. The dining sector is also under strain, with the National Restaurant Association of India tracking a 10-15% jump in input costs driven by pricier imported ingredients and elevated energy costs.

By the numbers: Around 10% of restaurants have been forced to shutter, resulting in estimated business losses of roughly INR 79 bn per month, the report noted.

(** Tap or click the headline above to read this story with all of the links to our background and outside sources.)

War impact reached India’s luxury real estate

India’s luxury housing market is facing fresh supply-side strain due to delayed imports of high-end construction materials from the Middle East, Business Standard reports.

Supply bottleneck hits premium builders: About 40% of under-construction luxury residential projects across India’s top six big cities are currently facing a shortage of imported materials such as aluminum, glass facades, and fittings, industry executives told the daily.

By the numbers: Imported material costs in the luxury segment have spiked by 12-18% since the regional escalation began, driven by freight surcharges on affected sea lanes that have surged 40-60% above pre-conflict baselines. Aluminum for high-performance facades, curtain wall systems, and structural glazing — primarily sourced from the UAE and Bahrain — has seen prices jump 8-12% in the last quarter alone.

“The impact is most pronounced in the INR 50 mn and above segment where international specifications are the baseline, not the exception,” Ashwinder R. Singh, co-founder of realty firm BCD Royale, told the daily.

What’s next? With selling prices largely fixed, rising costs are squeezing margins for developers. This is forcing some of them to increase pricing for future launches and potentially accelerate a pivot toward domestic suppliers even as demand for luxury housing currently remains resilient.

(** Tap or click the headline above to read this story with all of the links to our background and outside sources.)

Luxury jewelry brand Zoya delays UAE entry

Zoya, the luxury jewelry brand operated by Titan Company and a step-down subsidiary of Tata Group, has delayed its planned entry into the UAE, particularly Dubai, due to the regional war, The Hindu reports.

Zoya operates 13 standalone stores and seven galleries across India, along with five galleries in the US. It is continuing to add to its domestic retail chain even as its Gulf entry remains deferred. The brand had been exploring international expansion to serve Indian diaspora markets, but the war has pushed back its plans in the region.

“Our plans for UAE and Dubai got delayed because of war. We will focus on growing deeper in the market as luxury is not a sprint but a marathon,’’ Zoya’s business head Amanpreet Ahluwalia told the daily.

Is the war over? Markets seem to think so…

Optimism spreads across markets amid hopes for an extended ceasefire: US stocks hit an all-time high on Wednesday and continued to climb yesterday as investors cheered on hopes of an extended ceasefire. The Nasdaq 100 has climbed for 12 consecutive days, marking its longest streak of gains since 2017, Bloomberg reports. Regional markets have also continued to rally, with the DFM and the ADX slowly inching closer to pre-war levels, while Asian markets have started to recoup earlier losses.

The main reason? Signs that negotiations might lead to a permanent ceasefire. Despite there being no set date yet for the second round of talks, reports of a possible extension of the two-week ceasefire — and other reassuring signs that negotiations will be resuming — have helped calm market jitters.

Even options traders are now racing to position for gains in tech stocks, after earlier sell-offs left them underexposed. Tech stocks, in particular, are currently undervalued, with the premium for the Magnificent Seven narrowing to near eight-year lows in comparison to the broader S&P 500.

A part of this could also be that markets priced in a lot more than what has actually happened earlier in the conflict, CNBC’s Jim Cramer said. The fact that interest rates have not spiked as some had expected has helped reassure investors, he added.

But policymakers believe markets are underestimating the potential fallout of the war — even if it ends soon. When asked if markets need to be more wary, IMF chief Kristalina Georgieva said: “I would argue, yes, because what we see in supply chain disruptions is already quite significant.”

The issue is not just what’s happening right now, but the economic fallout expected after the war concludes, which, according to economists, will be severe. The IMF just this week slashed its global growth forecast by 0.3 percentage points and hiked its inflation forecast by 0.7 percentage points.

(** Tap or click the headline above to read this story with all of the links to our background and outside sources.)

MARKETS THIS MORNING-

Asian markets didn’t get the optimism memo, opening lower and bucking a wider rally across equity markets. Japan’s Nikkei and Hong Kong’s Hang Seng both fell 0.9% this morning, while South Korea’s Kospi was down 0.2%. Over on Wall Street, futures gained marginally.

Sensex	78,432	+0.5% (YTD: -8.09%)
NIFTY 50	24,341	+0.6% (YTD: -7.1%)
ADX	9,938	+0.2% (YTD: -0.4%)
DFM	5,965	+0.6% (YTD: -1.2%)
Tadawul	11,554	-0.3% (YTD: +10.1%)
EGX30	51,438	+1.4% (YTD: +22.8%)
Boursa Kuwait	8,204	+1.2% (YTD: -1.1%)
QSE	10,714	-0.1% (YTD: -0.4%)
S&P 500	7,041	+0.2% (YTD: +2.8%)
FTSE 100	10,583	-0.06% (YTD: +6.6%)
Euro Stoxx 50	5,957	+0.4% (YTD: +2.7%)
Brent crude	USD 97	-2.3%
Natural gas (Nymex)	USD 2.67	+1.1%
Gold	USD 4,794	+0.08%
BTC	USD 75,629	+1.3%

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

CALENDAR

APRIL

15-17 April (Wednesday-Friday): Entrepreneur Tech & Innovation Summit, Bengaluru.

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

MAY

1 May (Friday): Buddha Purnima.

26 May (Tuesday): Eid Al Adha.

JUNE

15-17 June (Monday-Wednesday): Prime Minister Narendra Modi to attend G7 Summit in Evian, France.

18-21 June (Thursday-Sunday): Bharat Buildcon, Yashobhoomi, Dwarka, Delhi.

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

26 June (Friday): Muharram.

Signposted to happen sometime in 1H 2026:

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

JULY

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

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

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

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

22-24 July (Wednesday-Friday): Rail & Metro Technology Conclave, Bharat Mandapam, 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, Mumbai.

7-9 September (Monday-Wednesday): Bengaluru Space Expo, Bangalore International Exhibition Centre, Bengaluru.

7-9 September (Monday-Wednesday): IPHEX, Bharat Mandapam, New Delhi.

17-19 September (Thursday-Saturday): Semicon India Conference, 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, Dubai.

25 December (Friday): Christmas Day.

Signposted to happen sometime in 2H 2026:

Monsoon Session of Parliament is expected to be held in July/August in New Delhi (TBA);
Reserve Bank of India’s Monetary Policy Committee meeting for the September cycle (TBA);
India Mobile Congress will likely be held in October in New Delhi (TBA).

JANUARY 2027

30 January-3 February (Saturday-Wednesday): Printpack India, India Expo Centre, Greater Noida (Delhi NCR).

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