Context:
An alternative route for trade to bypass the Red Sea was announced by the Israeli transport minister.
Red Sea Attacks Foster Arab-Israeli Trade Link by Land
- Landbridge Agreement: Israel-based Trucknet signed a cooperation agreement with Emirati-based Puretrans and the Dubai port-operating company to enter into an agreement connecting the ports of Dubai or Bahrain, passing through Saudi Arabia and Jordan, and getting to the port of Haifa, as well as Egypt, where cargo can continue to Europe.
- New Continental Routes: A similar route is the India Middle East Europe Economic Corridor (IMEC), which connected Mumbai ports to Greece via the Middle Eastern countries.
Mundra Port in India Serves as Alternative Route For Israel
- The proposed new route is mainly a land corridor first proposed during the Abraham Accords in 2020 (It was between Israel and the UAE, Morocco and Bahrain)
- India Role: India’s addition to the route will give it a multi-modal nature by connecting it to India’s western Ports.
- The Route: It starts from the Mundra port in Gujarat to UAE’s Dubai’s Jebel Ali Port, by sea, and then via land through Saudi Arabia and Jordan to Israel and further to Egypt.
- Truck-based: A major part of the land transport will be carried out on trucks with the trucks being operated by two shipping companies, Israel’s Trucknet and the UAE’s PureTrans.
Significance:
- Transit time: Travel time is estimated to reduce by 80 per cent compared to maritime routes
- Revenue Generator: The new route will generate revenue for Saudi Arabia and Jordan through transport fees and duties in addition to cutting costs for Israel
- Alternative to Maritime Trade: It can provide a secure and efficient continental alternative route characterised by high standards and competitive pricing.
- Shipping time: The shipping time will be reduced by 10 days; unloading and putting the cargo on trucks via the land route will take just four days.
- Security of International Trade: The attacks from Iran backed houthi militants in Red Sea has raised the shipping and insurance cost to trade significantly which is hampering global trade security and resilience.
The Red Sea Crisis:
- About: Commercial Ships linked to Israel are attacked with drones and missiles in the Red Sea by Yemen’s Houthi rebels to show their solidarity with Gaza, which has been suffering under a relentless Israeli military campaign since October 2023
- Location: The Red Sea links the Indian Ocean with the Mediterranean Sea via the Suez Canal.
- Crisis:
- Global trade has been disrupted as approximately 12% of which passes through the Red Sea.
- Shifting trade: Trade is shifting to new longer routes for example, they are taking to the south of Africa and crossing the Cape of Good Hope, increasing both costs and the time taken.
- Red Sea Crisis Response: In a new industry agreement signed the seafarers now have the right to refuse to sail on ships passing through the Red Sea.
- About Agreement: It is a negotiated settlement between seafarers union ie. International Transport Workers’ Federation (ITF) and commercial shipping companies, known as the International Bargaining Forum (IBF).
|
Also Read: The Challenge Of Maritime Security In The Global South
News Source: The Indian Express
To get PDF version, Please click on "Print PDF" button.
February 22, 2024