As the Israel-Iran conflict intensifies, India is increasingly at risk of collateral economic fallout, with energy security, trade routes, and key commercial interests facing growing uncertainty. The escalating hostilities, along with rising regional tensions, are posing direct threats to India’s strategic and economic links with West Asia.India has significant trade exposure to both warring nations. In 2024–25, India exported goods worth $1.24 billion to Iran and imported $441.9 million in return. Trade with Israel was even more substantial, with $2.15 billion in exports and $1.61 billion in imports. Still, more critical than these bilateral flows is India’s reliance on the region for energy: nearly two-thirds of its crude oil and half of its LNG imports pass through the Strait of Hormuz, which Iran has now threatened to close. This narrow waterway, only 21 miles wide at its narrowest point, handles nearly a fifth of global oil trade and is indispensable to India, which depends on imports for over 80% of its energy needs.
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