Lucknow: The escalating conflict between Iran and Israel, following attacks involving the United States, has triggered fresh uncertainty in global trade routes and sent ripples through key export clusters in Uttar Pradesh. Exporters in Agra and Moradabad say prolonged hostilities could severely disrupt shipments, inflate logistics costs and stall new orders from Europe, the US and the Middle East.
In Agra, the footwear industry, known globally for its high quality leather shoes, is bracing for delays and rising freight bills. Exporters fear that increased risks along the Strait of Hormuz and the Red Sea corridor will force shipping lines to divert vessels via the Cape of Good Hope in southern Africa. Industry representatives estimate that consignments could take 30 to 50 days longer than usual to reach European destinations. Freight costs are also expected to double due to the longer route.
Agra exports nearly Rs 4,000 crore worth of footwear annually, with trade worth Rs 250 crore to Rs 500 crore linked to Israel and other Middle Eastern countries. High end leather shoes and safety footwear manufactured in the city have strong demand in European industrial and security sectors. Besides footwear, decorative marble inlay work, brassware and zari zardozi products also find buyers in Iran and Israel.
Sanjay Goyal, president of the National Chamber of Industries and Commerce, said the industry could witness up to a 40 percent decline in business this financial year if the conflict persists. He said global banking transactions have already begun to face disruptions. With the possibility of fresh sanctions on Iran and wartime conditions in Israel, small exporters are likely to struggle with payment recoveries. Rising crude oil prices have pushed up the cost of chemicals used in leather processing, further squeezing margins. Higher transport costs may also make Agra products less competitive against China and Vietnam in global markets.
Gopal Gupta, president of the Agra Footwear Manufacturers and Exporters Chamber, said the sector was already grappling with the impact of a global slowdown. He said instability in the Middle East market would directly hurt the MSME segment, which forms the backbone of the industry.
In Moradabad, often referred to as the brass city, exporters of handicrafts say the renewed tensions have revived fears of order cancellations. The district exports handicrafts worth Rs 8,000 crore to Rs 9,000 crore annually, with major markets including the United States, Japan and Middle Eastern countries. Around 2,400 exporters are engaged in the trade.
Exporters said that orders secured at international trade fairs such as Frankfurt and Delhi could be put on hold if the conflict drags on. Ongoing negotiations with buyers may also stall, affecting future business. Some exporters estimate that up to 75 percent of handicraft trade in the district could face disruptions if shipping and payment channels are hit.
Satpal, secretary of the Handicraft Exporters Association, said orders received from fairs in Frankfurt and Turkey could be suspended. He warned that if the conflict between the US, Israel and Iran does not end soon, factories may be forced to scale down operations.
Suresh Kumar Gupta, chairman of the Indian Industries Association, said it would take three to four days for the scale of losses to become clear. He added that if shipping companies suspend or delay cargo movement, the handicraft sector would face a severe blow.
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Vikas Agarwal, vice president of the Moradabad SEZ Exporters Association, said handicraft exports are particularly sensitive to global instability. Even minor geopolitical tensions tend to affect orders significantly. Naveed Ur Rehman, president of the Moradabad Handicrafts Exporters Association, said artisans and exporters were already facing rising raw material costs and stiff competition. The conflict has added fresh pressure and could threaten jobs of hundreds of craftsmen.
Exporters across both clusters said the coming week would be critical in determining whether the conflict remains limited or escalates into a prolonged crisis with deeper economic consequences for Uttar Pradesh’s export driven industries.
