New Delhi: India has rolled out a coordinated customs and logistics exercise to help exporters handle stranded or returned cargo following the closure of the Strait of Hormuz.
The measures allow exporters to bring back cargo into the domestic system while easing storage and handling costs, as shipping lines suspend bookings and some Gulf ports operate under restrictions due to the ongoing US-Iran war.
A circular issued on Tuesday by the Central Board of Indirect Taxes and Customs (CBIC) under Section 143AA of the Customs Act, 1962, allows shipping lines to file fresh arrival manifests at the port of landing, followed by verification of containers and their seals, with mandatory 100% examination in cases where seals are found tampered.
The circular also specifies that if a vessel returns to a different Indian port without visiting a foreign destination, shipping lines or their agents must file a Sea Arrival Manifest (SAM) at the port where it docks, as per customs rules. A dummy port code will be used in the system for such cases.
In cases where exporters seek to reclaim their cargo, customs authorities have been directed to coordinate between the port of landing and the original port of export to verify whether any export incentives—such as IGST refunds or duty drawback—have been disbursed, and to initiate cancellation of shipping bills and the Let Export Order (LEO).
Reversal or recovery
The circular further requires that the port of export takes steps to ensure reversal or recovery of such export incentives if these have already been disbursed.
The circular also provides for permitting “Back to Town” clearance after due verification, enabling exporters to take returned cargo back into the domestic supply chain.
A system-level change is also being introduced to allow cancellation of shipping bills even after export general manifest filing, with details of such cancellations to be shared with agencies including the Reserve Bank of India (RBI), and Director General of Foreign Trade (DGFT) through Indian Customs Electronic Data Interchange Gateway (ICEGATE).
Till this system is operational, customs field formations have been directed to maintain records manually and update them once the system is in place, it said.
Earlier on Monday, commerce secretary Rajesh Agrawal said that the commerce ministry is expected to announce certain support measures to help exporters deal with the West Asia crisis.
“Hopefully within this week…we will send you the detailed briefing on what are the steps we are taking in the Department of Commerce to support the exports during this troubled time, especially in the Middle East,” he had said.
In parallel, state-run Container Corporation of India (CONCOR) has introduced temporary relief measures at its inland container depots or ICDs, where many export containers are currently stuck. It has offered 30 days of additional free storage and a 30% discount on plug-in charges for reefer containers, the company said in a statement.
CONCOR has also eased wharfage charges for warehouse-stuffed cargo and waived terminal, infrastructure and equipment imbalance charges if exporters take back containers within the specified timelines. It has also announced an additional 5% discount on rail freight for containers returned from ports to ICDs.
The facilitation measures will apply to cargo and containers handled during March, reflecting the immediate impact of the disruption on export logistics, it said.
Expanding international transshipment
The customs circular also temporarily expands international transshipment, allowing movement of less-than-container load (LCL) cargo from all notified ports and airports till 31 March, subject to safeguards. Customs authorities can extend this facility based on available storage and logistics capacity.
It further permits temporary unloading and storage of liquid bulk and break-bulk cargo diverted to Indian ports, under customs supervision and with strict conditions to ensure that such cargo is not diverted into the domestic market.
As per a senior government official, the steps are aimed at ensuring expeditious handling of cargo and preventing procedural bottlenecks as shipments are rerouted or returned due to the disruption.
The measures build on earlier customs circulars issued this month and will remain in force till 31 March.
“The steps announced by the government are timely and will provide much-needed relief to exporters facing shipment disruptions. Allowing return of cargo and easing logistics costs will help businesses manage immediate losses, but continued uncertainty in key shipping routes remains a concern for trade flows,” said Vinod Kumar, president, India SME Forum.
“While tensions in the Middle East have not yet caused any systemic disruption to trade financing, we are seeing a more cautious approach from exporters and importers, particularly in Gulf-linked trade corridors. Some export-oriented MSMEs are facing shipment delays and higher logistics and insurance costs, which is prompting greater reliance on invoice discounting and receivables financing to manage working capital,” said Ketan Gaikwad, MD & CEO, RXIL, a TReDS platform.
“If geopolitical uncertainties persist, demand for structured working capital solutions is likely to increase as businesses seek to secure liquidity and mitigate payment cycle risks,” said Gaikwad.
The Strait of Hormuz is one of the world’s most critical maritime chokepoints, handling nearly 20% of global oil trade and around one-fifth of global liquefied natural gas (LNG) flows. At its narrowest point, the corridor is just about 33 km wide, making it highly vulnerable to disruptions.
Since the conflict began on 28 February, at least 16–20 commercial vessels have been attacked or damaged in and around the Strait of Hormuz, according to maritime security agencies and industry estimates.
