Panic reaction, not a reflection of any change in economic fundamentals: Vijay Kalantri

As the war involving the Israel-US combine and Iran entered its second week, the Indian business community has concerns. The emerging geopolitical situation in the Middle East is surely a cause for concern. 

Against this backdrop, DH’s Mrityunjay Bose spoke with Vijay Kalantri, President of the All India Association of Industries and Chairman of the World Trade Center-Mumbai. “The safety and well-being of millions of people living and working in the region remains a key concern,” said Kalantri. 

Following are the excerpts of the interview: 

How do you view the current situation after one week of war?

The global business community is closely monitoring the current geopolitical tensions in the Middle East, as the region plays a crucial role in international trade, energy security, and maritime logistics. Stability in this region is vital to ensure the uninterrupted movement of goods, commodities, and energy resources across global markets. The Middle East hosts strategically important maritime corridors, including the Strait of Hormuz, through which nearly one-fifth of global oil supplies pass every day. Disruptions in these shipping routes will impact global energy markets, freight costs, and supply chain stability.

Many Indians work in the Gulf Cooperation Council (GCC) countries and the West Asia-North Africa (WANA) region and we have extensive trade relations. 

The safety and well-being of millions of people living and working in the region remains a key concern. Nearly nine million Indians reside across Gulf and Middle Eastern countries, contributing significantly to economic cooperation and strengthening people-to-people ties between India and the region.

What has been the Indian response?

The trade and industry community reiterates that peace, stability, and open dialogue are the cornerstones of sustainable global trade. We call upon the international community to prioritise diplomatic engagement and de-escalation, ensuring that the Middle East remains a gateway for commerce and cooperation rather than a source of global economic uncertainty.

Do you foresee a major turmoil in Indian markets?

India is relatively resilient amid the current volatility. The current market movements, whether in equities, gold, or crude, are largely a panic reaction, not a reflection of any change in economic fundamentals. We enjoy cordial relations with all countries and are not a direct participant in this conflict, and we believe in de-escalation of war and negotiations through diplomatic dialogue. With strategic petroleum reserves covering 40 to 45 days of requirements and crude sourced from over 40 countries, our supply flexibility is stronger than ever. We urge the business community to stay calm and avoid decisions driven by short-term fear.