Why the Gulf's maritime routes are India's economic lifeline

For India, the Gulf region is much more than merely being a neighbourhood across the Arabian Sea. In fact, this region is India’s key energy partner. Nearly half of India’s crude oil imports originate from Gulf Cooperation Council (GCC) countries, while Qatar remains India’s largest supplier of liquefied natural gas (LNG). This energy relationship has made maritime connectivity between India and the Gulf countries a significant component of India’s economic stability.

Recent disruptions affecting the Strait of Hormuz and shipping through the Red Sea have therefore indicated a fundamental reality that India’s energy security depends not only on reliable suppliers but also on uninterrupted sea lanes. The Strait of Hormuz is among the most strategically important maritime passages in the world. Saudi Arabia, the United Arab Emirates (UAE), Kuwait, Iraq and Qatar rely on this narrow waterway to export hydrocarbons to global markets, including India.

For decades, New Delhi’s engagement with the Gulf region has been guided by the notion that these maritime routes would remain open despite periodic regional crises. However, recent disruptions have shown that while oil production may remain stable, transporting that oil has become increasingly vulnerable to geopolitical instability.

The significance of these disruptions lies less in the prospect of an immediate shortage of oil and gas than in the increasing cost and complexity of moving energy supplies. When shipping routes become contested or unsafe, sea vessels are forced to take longer alternative routes with insurance premiums rising sharply, freight charges increasing and delivery schedules becoming tentative. These additional costs eventually lead to expensive oil and gas despite the fact that global production levels remain unchanged. For India, this difference is important. Energy security is no longer defined solely by the availability of oil but also by the resilience of its logistics. Indian refiners have become remarkably adept at diversifying procurement and adjusting crude grades in response to changing market conditions. Still, even the most flexible procurement strategy cannot fully offset disturbances in the maritime corridors connecting Gulf producers with Asian consumers.

Further, the Gulf’s significance for India goes beyond hydrocarbons. Bilateral trade between India and GCC countries exceeds US$180 billion annually. Along with that, millions of Indian expatriates living in the Gulf region contribute significantly through remittances. Commercial ships carrying petrochemicals, fertilisers, food products and manufactured goods also traverse through the same sea lanes. So, any disruptions in this maritime connectivity affect not only India’s energy imports but larger trade flows linking India and the Gulf region. India has made considerable progress in strengthening its energy resilience over the past decade. Strategic petroleum reserves have multiplied, long-term supply agreements have been strengthened, and procurement has diversified beyond traditional Gulf suppliers. Also, the purchase of Russian crude oil after 2022 has demonstrated India’s ability to adapt rapidly to changing market conditions. However, recent events signal an important limitation in this diversification strategy. Supplier diversification does not necessarily translate into route diversification. Much of India’s imported energy continues to be dependent on maritime corridors. The vulnerability therefore lies not simply in where the oil comes from, but in how it reaches Indian ports. This has led to renewed emphasis on India’s maritime engagement with the Gulf countries. Over the past decade, bilateral relationships with Saudi Arabia, the UAE, Oman and Qatar have expanded beyond energy trade and include defence cooperation, maritime security, logistics partnerships and intelligence sharing. These partnerships reflect a shared interest in preserving secure commercial navigation across the northern Indian Ocean. Also, the Indian Navy’s enhanced role in safeguarding Sea Lines of Communication (SLOCs), escorting merchant shipping and participating in regional maritime security initiatives has become an important complement to India's energy diplomacy. Protecting commercial shipping has become an essential pillar of economic security. In fact, stable maritime connectivity enables reliable energy imports, predictable supply chains and sustained industrial growth.

The recent disruptions also reinforced the significance of India’s long-term energy transition. Investments in renewable energy, green hydrogen and electric mobility seek to reduce structural dependence on imported hydrocarbons over time. Yet the transition will happen gradually. Ensuring secure maritime access to Gulf energy supplies therefore remains indispensable during this transition. India’s relationship with the Gulf region has evolved from a buyer-seller dynamic into a comprehensive strategic partnership encompassing investment, infrastructure, food security, technology and defence. Energy remains the foundation of this partnership, but the events in the past few months clearly show that maritime security has become equally important. The resilience of the SLOCs is no longer a regional concern and is now directly linked to India’s inflation outlook, industrial competitiveness and overall economic stability. In this increasingly uncertain geopolitical environment, safeguarding these maritime arteries is as important as securing long-term energy supplies. 

Dr Anu Sharma is an Assistant Professor at Amity Institute of Defence and Strategic Studies (AIDSS) Amity University in Noida.

The views expressed are that of the author and do not represent the institution.