By Sanskriti Global Exports by Himanshu Gupta

Navigating the Shifting Tides: A Strategic Briefing for Indian Trade Professionals

Date: October 23, 2025

In the dynamic world of international trade, standing still is the fastest way to fall behind. The past week has been a testament to this reality, presenting a complex tapestry of domestic policy shifts, global logistical headwinds, commodity volatility, and promising trade negotiations. For the Indian importer and exporter, these are not just headlines; they are critical variables that will define profit margins, supply chain resilience, and market access for months to come. As your trusted trade advisor and analyst, my goal is to cut through the noise and provide a clear, strategic breakdown of these events, offering actionable insights to help you navigate the challenges and seize the opportunities that lie ahead.

This week’s developments underscore a pivotal theme for 2025: the urgent need for strategic agility. From a new government scheme designed to empower electronics exporters to a logistical bottleneck in a critical strait, the message from the market is clear. Businesses that can pivot their sourcing strategies, diversify their logistics, and prepare for new market openings will be the ones to thrive. Let's delve into the specifics.

Factual Summary of Key Developments

A confluence of four major events has shaped the trade landscape this week, each with significant repercussions for Indian commerce.

First, the Directorate General of Foreign Trade (DGFT) unveiled the 'Electronics Export Acceleration Scheme' (EEAS). This new initiative is designed to supplement the existing Production Linked Incentive (PLI) scheme, with a specific focus on Micro, Small, and Medium Enterprises (MSMEs) that form the backbone of the electronics component supply chain. The EEAS aims to provide faster duty drawbacks, subsidised credit for technology upgrades, and a simplified, single-window clearance process for MSMEs who are certified vendors to larger electronics exporters. The stated goal is to deepen domestic value addition and bolster the global competitiveness of India's finished electronic goods.

Second, on the international logistics front, severe and unprecedented congestion at the Port of Singapore and in the Malacca Strait is causing significant shipping delays. Reports indicate a backlog of over 100 container vessels, leading to wait times extending up to 10 days. This bottleneck, attributed to a surge in post-pandemic cargo volumes and new regional environmental regulations, is disrupting schedules for shipments between Asia, Europe, and the Americas. In response, the Indian government has reportedly fast-tracked high-level discussions to promote the India-Middle East-Europe Economic Corridor (IMEC) as a viable, albeit currently more expensive, land-sea alternative.

Third, the global commodities market has been rattled by a sharp surge in steel prices. A sudden and unexpected cut in production from major steel mills in Brazil, citing critical infrastructure maintenance, has sent shockwaves through the market. Hot-rolled coil (HRC) futures have jumped nearly 15% in the last ten days, directly impacting input costs for a vast array of Indian industries, from construction and infrastructure to automotive components and consumer durables.

Finally, a positive development comes from the diplomatic arena. Sources close to the negotiations report that the long-awaited India-UK Free Trade Agreement (FTA) is in its final stages. Significant breakthroughs have apparently been achieved on complex issues like rules of origin for textiles and automobiles, which could grant Indian exporters preferential access. However, key sticking points remain, particularly concerning Indian agricultural tariffs and UK demands on data localisation and digital trade.

Implications for Indian Import-Export Professionals

Translating these headlines into business strategy is paramount. Here is a breakdown of the immediate implications and recommended actions for your business:

• Electronics Exporters Must Actively Engage with the EEAS: The new DGFT scheme is a direct invitation to re-engineer your supply chain. Immediately identify your MSME suppliers and assist them in getting certified under the scheme. Doing so not only helps them but can lower your component costs and improve your overall export incentive profile. This is a chance to build a more resilient and cost-effective domestic supplier ecosystem. Begin dialogues with your financing partners to see how the subsidised credit can be leveraged for mutual growth.
• Logistics Managers Need to Diversify and Communicate: The Singapore congestion is not a temporary glitch; it's a symptom of a strained global system. If you have cargo routed via the Malacca Strait, immediately add a 10-15 day buffer to your delivery timelines and proactively communicate these delays to your clients. Simultaneously, conduct a thorough cost-benefit analysis of the IMEC route for high-value or time-sensitive shipments to Europe. While the per-unit cost may be higher, the reliability and reduced transit time could outweigh the expense and prevent costly contractual penalties.
• Steel Importers & Engineering Goods Exporters Face Margin Pressure: The surge in steel prices requires immediate financial and procurement action. If you are an importer, consider hedging on commodity exchanges to lock in prices. If you are an exporter of steel-based products (e.g., auto parts, machinery), you must re-calculate your FOB/CIF pricing. Absorb the cost, and you risk unprofitability; pass it all on, and you risk losing competitiveness. A hybrid approach, combined with transparent communication with your buyers about the global market situation, is the most prudent path forward.
• Textile and Auto Exporters Should Prepare for the UK Market: The positive signals from the India-UK FTA talks are a cue to get ahead of the curve. Do not wait for the final signature. Begin preliminary market research in the UK. Start aligning your product documentation and compliance certifications (e.g., UKCA marking) with British standards. Understanding the 'favourable rules of origin' now will allow you to structure your supply chain to maximise the benefits of zero-duty access once the agreement is ratified. This is a first-mover advantage waiting to be claimed.

Conclusion: The Age of Agility

The developments of this week are a microcosm of the new global trade environment. It is a landscape defined by targeted government support, fragile supply chains, volatile input costs, and the redrawing of trade maps through strategic agreements. For the Indian import-export community, the path to success is no longer about just finding the cheapest supplier or the fastest route. It is about building a resilient, diversified, and informed business strategy. The opportunities presented by the EEAS and the potential UK FTA are immense, but they can only be fully realised by businesses that can skillfully navigate the challenges of logistical snarls and commodity fluctuations. Stay informed, stay agile, and position your business not just to survive these shifts, but to master them.

Source: Original