Cost of freight, insurance rises for shipments due to Red Sea conflict; imports currently cushioned by inventory

The cost of freight and insurance for shipments has risen in the last one month owing to the ongoing conflict in the Red Sea, which has forced ships to avoid the Suez Canal and take a longer route around the African peninsula, sources in the government told CNBC-TV18.

Government officials met shipping companies and exporters on Thursday, January 4, to take stock of the financial impact of the Red Sea conflict, where it was informed that, though the cushion of a month's inventory is currently available for imported items, disruptions may arise in the near future if the conflict prolongs.

A government official has said that there's no shortage of shipping containers, but the turnaround time has increased by 14 days.