Weekly intelligence for Supply-Chain, Procurement & CEO desks
Leadership Nugget
“India’s new policies remind us: supply chains don’t just shift — they get rewritten by governments.”
EXEC SNAPSHOT – India’s Procurement Reset
Q: What new policy has India launched?
A: New Delhi is conserving strategic inputs (rare earths, graphite) for domestic use while courting Western OEMs to assemble more in India. In June 2025, the government asked state-run IREL to suspend a 13-year rare-earth export deal with Japan (Reuters, 2025a). At the same time, Indian graphite suppliers are moving to capture US demand as Washington raises duties on Chinese graphite (Reuters, 2025b).
What it means: India offers opportunities for assembly and finished goods, but becomes less reliable for upstream raw materials.
Q: Why now?
A: India seeks to become the premier “China+1” sourcing hub, reduce import dependence, and attract Western investment (Financial Times, 2025a).
Q: Are carriers monetizing shipment visibility?
A: Yes. Maersk Visibility Studio and Hapag-Lloyd Live Position both sell real-time visibility services (Maersk, 2025; Hapag-Lloyd, 2024).
What it means: Data is a paid line item. Procurement must negotiate API access, SLAs, and security rights.
DEEP DIVE — India’s Procurement Pivot
India’s new direction blends export restrictions with manufacturing incentives:
Export limits: Rare earths and graphite restricted for outbound shipments (Reuters, 2025a; Reuters, 2025b).
PLI incentives: EV batteries and semiconductors backed by multi-billion funding (Ministry of Heavy Industries, 2025; India Semiconductor Mission, 2025).
Strategic positioning: Western OEMs encouraged to assemble locally, but raw inputs will be conserved.
Near-term impacts (2025–2026)
EU: Supply shortfalls in critical minerals → diversification to Africa and Central Asia.
US: More sourcing from India for finished goods, but contract renegotiation needed for minerals.
Global: Expect price volatility in rare earths and graphite.
Mid-term impacts (2027–2030)
India emerges as an assembly hub.
Risk of dependency shift from China to India without diversification.
More JV opportunities but fiercer competition for upstream access.
👉 Essence: India is both a partner and gatekeeper. Buyers must manage the duality of opportunity in finished goods and restrictions on inputs.
TRADE ROUTE ALERT — Red Sea / Suez Risk Still Elevated
Persistent caution: Despite ceasefire efforts, the Red Sea remains too risky for routine transit, with carriers sticking to Cape of Good Hope routing (Reuters, 2025c).
Insurance premiums: War-risk cover is ~0.7% of vessel value, up from ~0.3%; peaks have reached nearly 1% (Reuters, 2025d; Reuters, 2025e).
Regional fallout: Israel’s Port of Eilat has lost 90% of throughput and risks closure (Washington Post, 2025).
Policy signal: The UN Security Council extended Red Sea monitoring until Jan 2026, underlining that instability will persist (United Nations, 2025).
Implication: Procurement must budget higher insurance + longer lead times through Q4.
KPI DASHBOARD
Metric (Q&A framing) | Latest Insight | Why it matters for you |
|---|---|---|
Q: Are India’s export restrictions already impacting sourcing? | India suspended a 13-year rare-earth export deal with Japan (June 2025) (Reuters, 2025a). | EU and US OEMs relying on Indian minerals face immediate sourcing gaps; diversify to Africa & Central Asia. |
Q: How large are India’s incentives for advanced batteries? | ACC battery PLI outlay: ₹18,100 crore (~$2.1bn) (Ministry of Heavy Industries, 2025). | Strong push for local production; procurement teams should evaluate JV opportunities. |
Q: What’s the freight-rate baseline? | FBX Global Container Index: $5,410/FEU (Week 34) (Macromicro, 2025). | Rates steady despite Suez rerouting; anchor contracts and budgets on index. |
Q: What’s the macro signal in Europe? | Eurozone flash PMI Aug: 51.1 (Reuters, 2025f). | Signs of mild recovery; better timing for supplier renegotiations. |
Q: Is U.S. demand still expanding? | U.S. flash PMI Aug: 55.4 (S&P Global, 2025). | Strong demand could tighten freight capacity and raise Q4 surcharges. |
Leadership Questions
Do our India contracts address export restrictions, data use, and transfer terms?
Have we mapped non-China and non-India sources for rare earths and graphite?
Are we aligned with India’s PLI/semiconductor incentives?
Have we factored in war-risk premiums and Cape routing for Q4 logistics?
ProcWee™ 3-Minute Procurement Diagnostic
Question | Fully Confident | Not Sure | No Time / Resource |
|---|---|---|---|
India export-curb clauses & data terms in contracts? | ☐ | ☐ | ☐ |
Alternative sources & recycling validated? | ☐ | ☐ | ☐ |
PLI/semiconductor opportunities mapped? | ☐ | ☐ | ☐ |
Cape rerouting + insurance premiums costed? | ☐ | ☐ | ☐ |
One-Line Verdict
India is moving up the value chain — keeping minerals, exporting products. Red Sea risks raise logistics costs. Leaders must de-risk both input dependencies and trade routes now.
Sources
European Commission. (2025, July 24). Data Act explained. Retrieved from https://digital-strategy.ec.europa.eu/en/factpages/data-act-explained
Hapag-Lloyd. (2024, April 29). Hapag-Lloyd launches first dry container tracking product “Live Position”. Retrieved from https://www.hapag-lloyd.com/en/company/press/releases/2024/04/hapag-lloyd-launches-first-dry-container-tracking-product--live-.html
India Semiconductor Mission. (2025). Scheme for setting up semiconductor and display fabs. Retrieved from https://ism.gov.in/
Macromicro. (2025, Week 34). Freightos Baltic Index (FBX) — Global Container Index (weekly). Retrieved from https://en.macromicro.me/series/17502/fbx-global-container-index-weekly
Ministry of Heavy Industries, Government of India. (2025). PLI Scheme for National Programme on ACC Battery Storage. Retrieved from https://heavyindustries.gov.in/pli-scheme-national-programme-advanced-chemistry-cell-acc-battery-storage
Maersk. (2025). Maersk Visibility Studio. Retrieved from https://www.maersk.com/digital-services/maersk-visibility-studio
Reuters. (2025a, June 13). India moves to conserve its rare earths; seeks halt to Japan exports. Retrieved from https://www.reuters.com/world/india/india-moves-conserve-its-rare-earths-seeks-halt-japan-exports-sources-say-2025-06-13/
Reuters. (2025b, August 20). US tariffs on Chinese graphite spark opportunity for India’s Epsilon Advanced Materials. Retrieved from https://www.reuters.com/business/autos-transportation/us-tariffs-chinese-graphite-spark-opportunity-indias-epsilon-2025-08-20/
Reuters. (2025c, January 17). Red Sea trade route will remain too risky even after ceasefire, executives say. Retrieved from https://www.reuters.com/world/middle-east/red-sea-trade-route-will-remain-too-risky-even-after-gaza-ceasefire-deal-2025-01-17/
Reuters. (2025d, July 10). Red Sea insurance premiums soar after deadly Houthi ship attacks. Retrieved from https://www.reuters.com/business/autos-transportation/red-sea-insurance-soars-after-deadly-houthi-ship-attacks-2025-07-10/
Reuters. (2025e, June 23). Escalating Hormuz tensions drive up Middle East war-risk insurance costs. Retrieved from https://www.reuters.com/world/middle-east/escalating-hormuz-tensions-drive-up-middle-east-war-risk-insurance-costs-sources-2025-06-23/
Reuters. (2025f, August 21). Euro zone business activity accelerates in August as new orders grow — PMI. Retrieved from https://www.reuters.com/world/europe/euro-zone-business-activity-accelerates-august-new-orders-grow-pmi-shows-2025-08-21/
S&P Global. (2025, August 21). Flash US PMI signals faster growth and hiring. Retrieved from https://www.spglobal.com/marketintelligence/en/mi/research-analysis/flash-us-pmi-signals-faster-growth-and-hiring-but-also-shows-tariffdriven-inflation-aug25.html
United Nations. (2025, July 15). Security Council extends monitoring of Red Sea attacks to Jan 2026 (Resolution 2787). Retrieved from https://press.un.org/en/2025/sc16120.doc.htm
Washington Post. (2025, July 21). Houthi attacks take toll on Israel’s Red Sea port (Eilat). Retrieved from https://www.washingtonpost.com/world/2025/07/21/port-eilat-israel-houthi-shutdown-shipping-trade/
