India’s Directorate General of Foreign Trade (DGFT) has extended enhanced export credit insurance cover for shipments to West Asia to September 30, the second extension of the measure since it was introduced in March. “The eligibility timelines under Component II of the EPM RELIEF intervention are extended up to 30th September 2026 to support Indian exporters and mitigate logistics challenges arising out of the continuing West Asia Crisis,” the DGFT said in its notification, as reported by The Economic Times.
The extension applies to Component II of the Resilience and Logistics Intervention for Export Facilitation (RELIEF) scheme, administered by state-owned ECGC Ltd. under the government’s Export Promotion Mission, with an outlay of 4.97 billion rupees. Component I provides up to 100% risk coverage above standard ECGC terms for shipments made between Feb. 14 and March 15, 2026. Component II, now extended, provides up to 95% coverage for shipments dispatched from March 16, 2026, onward. Component III reimburses MSME exporters lacking ECGC cover for up to 50% of additional freight and insurance costs, capped at 5 million rupees per exporter. ECGC’s standard policies otherwise cover 80% to 90% of losses, placing the RELIEF top-up above the agency’s usual terms. Eligible countries expanded in April to include Egypt and Jordan alongside the original Gulf states.
The repeat extension suggests the disruption RELIEF was designed to address has not eased since March. A separate government action, reported independently, points in the same direction without being directly tied to RELIEF in any source reviewed: in April, India approved a 129.8-billion-rupee (about US$1.4 billion) sovereign guarantee for a new domestic maritime insurance pool, intended to maintain capacity as international reinsurers pull back from war-risk exposure in the Gulf. “There was a need for a domestic maritime risk covering pool to maintain sovereignty and continuity of trade in face of withdrawal of coverage due to sanctions or due to geopolitical tensions,” the government said. The pool, covering hull and machinery, cargo, and war risk, will run for an initial 10 years with an option to extend by five.
The two measures sit at different points in the trade chain: RELIEF covers exporters’ credit and payment risk, while the pool covers marine insurance capacity for vessel owners and cargo interests. No source reviewed states that the two were planned together; they are presented here as parallel evidence of the same underlying market conditions, not a coordinated package. Conflicts involving Iran and Western sanctions on Russia have reduced reinsurance support available to primary carriers on some routes, the stated rationale behind the pool.
The hull war insurance market’s own data supports the picture of continued strain. The Joint War Committee (JWC), which sets Listed Areas for the London hull war market on behalf of Lloyd’s and IUA members, added Gulf states hosting US military bases to its Listed Areas once the conflict began and says cover is now reviewed case by case rather than on standard terms. The JWC describes the situation as “evolving” and “highly unpredictable,” citing more than 25 attacks on commercial vessels. P&I club Skuld has separately assessed the regional threat level as “CRITICAL,” citing the Joint Maritime Information Centre (JMIC), and has documented expanded US enforcement zones affecting vessels of all flags in the wider Gulf of Oman and Arabian Sea.
Commenting on the government’s wider approach to the disruption, professional services firm EY said that the government “may need to deploy a substantive countercyclical policy,” adding that “it may also be prudent for the GoI to co-opt larger and more industrialised states into this countercyclical effort.” EY pointed to a 1-trillion-rupee Economic Stabilisation Fund (ESF), created in the current fiscal year, as an existing buffer that could be expanded to manage prolonged external shocks, according to the same report.
Neither RELIEF nor the new sovereign pool has published claims or utilisation data, so it is not possible to assess how much of either facility’s capacity has been used or whether exporter or shipowner behaviour has changed as a result. The pool’s allocation between hull, cargo, and war risk, and its premium terms relative to the international capacity it replaces, have not been disclosed. No comparable 2025-2026 measures from other Asian export credit or reinsurance bodies responding to the same conflict were identified. With both measures now in place and RELIEF extended a second time, the government appears to be planning for the disruption to continue through at least the third quarter of 2026.
