Exporters, freight forwarders seek government help as war surcharges on cargo surge

Mumbai: Exporters and freight forwarders have sought the government's intervention after global shipping lines began imposing steep war-risk surcharges on cargo to and from the Middle East.

In some cases, the charges nearly doubled from previously negotiated rates, adding more pressure on trade facing severe turmoil due to the Iran war.

In a letter to the ministry of ports, shipping and waterways on Monday, the Federation of Freight Forwarders' Associations in India (FFFAI) said the sudden levies are being imposed with little transparency or clarity on how they are calculated or when they are applied, creating "considerable uncertainty and operational difficulty" for exporters, importers, and logistics providers.


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"Shipping lines have started levying war risk surcharges (WRS) on cargo moving to and from certain destinations," the industry body said in a letter on Monday, a copy of which was reviewed by ET. "In several instances, the surcharge being demanded is nearly double the originally negotiated ocean freight, placing an unexpected and substantial financial burden on the trade".

The charges introduced by major carriers since early March vary widely but typically range from about $1,500 per 20-foot container to $3,500-$4,000 for larger or refrigerated containers, depending on the route and equipment type.

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The move comes as global shipping networks face disruptions from the escalating conflict in the region. Continued fighting and security threats around the Gulf triggered a sharp rise in insurance premiums for vessels. This has forced several carriers to suspend bookings to key destinations or reroute ships away from high-risk waters, including parts of the Gulf and approaches to the Strait of Hormuz.

The tensions have triggered operational disruptions across aviation and shipping networks, tightening capacity and pushing up freight and insurance costs.

While acknowledging that "extraordinary geopolitical circumstances may necessitate additional risk coverage," FFFAI said the current implementation of the surcharge lacks transparency and risks worsening pressure on exporters already grappling with delays and volatile logistics costs.

The association has asked the government to direct shipping lines to disclose the basis and methodology used to determine the surcharge and provide a detailed cost break-up.

It also sought clarity on the timeline for imposing the surcharge, flagging uncertainty in situations where cargo has already been gated into port terminals or container freight stations, loaded on vessels but yet to sail, or booked earlier under confirmed freight contracts.

The industry body also warned against retrospective charges being imposed after cargo has already been handed over or loaded on vessels, saying such moves are triggering commercial disputes between exporters, freight forwarders, and overseas buyers.