Syllabus: GS-II;
Subject: International Relations/Economic Development
Topic: Government policies and interventions for development in various sectors.
Context: Commerce Ministry addresses Red Sea disruptions, and urges DFS to maintain credit for exporters; concerns rise after military strikes in Yemen.
Issue: Red Sea Disruptions.
Synopsis:
- Commerce Ministry instructs DFS to maintain credit flow to exporters amid Red Sea route disruptions.
- Concerns arise after US and UK military strikes in Yemen impact shipping in the Red Sea.
- Freight rates to Europe double due to security tension in the Red Sea region.
- Consignments facing delays, impacting low-value product shipments like agriculture and textiles to Europe.
- Government instructs Export Credit Guarantee Corporation not to raise insurance premiums amid rising shipping costs.
Red Sea disruptions impact on India:
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Way Forward:
The continuous monitoring, adapting logistics to alternative routes, and exploring diplomatic solutions to mitigate disruptions in the Red Sea region.
