Digital twins on the IPA's PORTLIVE platform predict berth availability, reducing truck waiting times by 30%.

The volatility of the Hormuz Strait highlights the urgency of the MMLP project

India is worried about shipping problems in the Strait of Hormuz. It is urging strong protection for supply chains because of problems between countries that could affect energy supplies around the world. With 20% of the world’s oil passing through this narrow chokepoint daily, including over 60% of India’s crude oil imports, the Ministry of Commerce convened stakeholders to mitigate the impact of potential disruptions on West Coast ports.

Amidst the tensions between Iran and the US and blockades,

Amidst the tensions between Iran and the US, and the potential for blockades, New Delhi has highlighted the acute risks to EXIM lifelines. Since the Houthi-linked incidents in March 2026, freight rates have spiked by 150%, forcing 85% of Gulf-bound vessels to take Cape detours that add 10–14 days and $1.2 million to the cost of each VLCC voyage. The JNPA and Mundra have reported a 25% increase in vessel bunching, with container dwell times reaching seven days compared to the usual three-day average. This has had a severe impact on textile and pharmaceutical exporters, who account for 40% of cargo exposed to the Hormuz Strait.

A multifaceted government response 

A multifaceted government response has been observed. The Strategic Petroleum Reserves at Mangaluru, Padur, and Chandikhol now hold 13.5 million tonnes — a 90-day buffer at peak demand — while the blending of 20% ethanol displaces 5 million tonnes of crude oil each year. Refineries are pivoting towards Russia (up 35% to 2 million barrels per day), Guyana, and US shale, bypassing the Strait of Hormuz via Pacific routes. Ministry data shows that the sourcing of crude has diversified from 27 nations a decade ago to 42 nations today, with LNG contracts from Qatar and Australia hedged against price spikes.

The burden of maritime logistics

The burden of maritime logistics lies with it. Since January, navy escorts have secured over 500 vessels, but the perils of the Bab el-Mandeb compound delays — Yanbu/Sokhna shipments are now being rerouted via the Cape, which is inflating the cost of Saudi and Russian oil by 40%. Ports are ramping up: Sagarmala's ₹2,000 crore dredging project in Kochi and Tuticorin will allow larger tankers to access the ports with a draft of 20 metres, while Gati Shakti's DFC extensions will enable an additional 15 million tonnes to be transported from the Gujarat hubs. Meanwhile, digital twins on the IPA's PORTLIVE platform forecast berth availability and reduce truck waiting times by 30%.

 Suggestions for fortifying the pace of progress.

The sector proffers suggestions for fortifying the pace of progress. The FIEO is calling for PLI extensions for container manufacturers to reduce reliance on imports by 50%. Meanwhile, the CII is advocating for a boost in rail's share from 30% to 50% through the Western DFC. "The volatility of the Hormuz Strait highlights the urgency of the MMLP project — Greater Noida's ₹1,000-crore park will reduce congestion in the NCR," said the CEO of Logistics India. Green hydrogen hubs at Kandla are targeting 1 million tonnes per annum (mtpa) by 2028, with the aim of reducing fossil fuel imports by 10% in the long term.

Related : India’s FY26 Port Sector Delivers Historic Sweep

Trade is affected by broader implications

Trade is affected by broader implications. Fertiliser and phosphates from the UAE, 40% of which are routed through the Hormuz Strait, face a 20% premium, which is putting pressure on rabi sowing. Meanwhile, edible oils from the Gulf are pushing up the CPI by two points. Yet, there are also upsides: India’s $120 billion oil deals with Russia have yielded $8 billion in savings year to date, funding SPR top-ups. Meanwhile, QUAD maritime drills enhance MDA, with IFC-IOR fusing satellite and drone feeds from 30 nations.

15 ships flying the Indian flag are idling in the straits

As the situation remains in a state of heightened tension – with 15 ships sailing under the Indian flag idling in the straits – Prime Minister Gati Shakti's ₹1.5 lakh crore outlay aspires to propel India to the top 25 Logistics Performance Index rankings by 2030. Rerouting expertise and multi-sourcing have reduced the impact on GDP to 0.3%, compared to 1.2% during the 2019 Abqaiq crisis. The playbook for shippers is clear: diversify origins, stockpile buffers, and embrace rail and air bridges

.# Indian flag #Prime Minister Gati Shakti #Gati Shakti #Cape detours # US # Iran # blockades #risks of Hormuz# energy squeezes #MMLP project