Escalating geopolitical tensions in West Asia are beginning to disrupt India’s pharmaceutical export supply chains, with industry estimates warning of potential losses of up to INR 5,000 crore if the situation continues through March.

The conflict in the region has strained shipments to Gulf markets and disrupted major maritime trade corridors such as the Red Sea, the Strait of Hormuz and key Gulf shipping routes, forcing rerouting and causing delays in deliveries.

Gulf countries account for around 5.58 Percent of India’s roughly USD 30 billion pharmaceutical exports and also serve as an important transit hub for shipments to other global markets, including the US.

Industry officials warn that freight costs have surged sharply as shipping companies impose additional surcharges ranging from USD 4,000 to USD 8,000 per shipment, significantly increasing logistics expenses for exporters.

According to the Pharmaceuticals Export Promotion Council of India (Pharmexcil), prolonged disruption in export flows to the region could result in losses between INR 2,500 crore and INR 5,000 crore for the Indian pharmaceutical industry.

The crisis is also expected to push up input costs due to rising crude prices and higher freight charges for active pharmaceutical ingredients and finished formulations, potentially affecting inventory cycles and delivery timelines for drugmakers.

Industry bodies have urged the government to consider relief measures such as logistics support or export incentives to help pharmaceutical companies offset rising shipping costs and sustain supply to critical markets in the Gulf region.