Since November 2023, Houthi attacks have caused container transits through Bab-el-Mandeb to collapse by 75%, pushing most container ships towards the Cape of Good Hope route. Red Sea hubs such as Jeddah and King Abdullah Port have consequently lost up to 70-90% of calls by the largest vessels, while ports including Colombo, Barcelona, Djibouti and Dammam have captured growing shares of transhipment traffic. In this reshaping of the market, Nhava Sheva, India’s largest container terminal near Mumbai, recorded growth of 12.6% in 2025, also supported by the Phase 2 expansion, which added about 2.4 million TEU of capacity.
The model that has taken hold is one of “split” transhipment: large Asian mother ships have stopped diverting into the Red Sea to serve Gulf ports directly, so shipments bound for the region are discharged at Nhava Sheva or Colombo and routed by feeder to Jeddah, Dammam or Sohar. A group of niche regional carriers has built on this pattern, with Folk Maritime, controlled by Saudi sovereign wealth fund Pif, emerging as the main player. The company operates several links between the Indian subcontinent and the Gulf, including the India Gulf Service, with a Mundra-Nhava Sheva-Sohar-Dammam rotation on which Cma Cgm charters slots, and the India Red Sea Service, operated with Cu Lines and Marsa Ocean on the Jeddah-Djibouti-Nhava Sheva-Mundra route. A new stand-alone service, India-Red Sea, will be added in August, with three vessels of about 1,900 TEU each. Other carriers active on the route include Global Feeder Shipping, which operates the Indian coastal network for One with calls at Mundra, Pipavav, Cochin and Colombo, and Ignazio Messina, which has resumed calls at Nhava Sheva after a 20-year absence with its Med-Middle East/India service.
The expansion of these connections, however, has taken place in a far from straightforward environment. In March 2026, with the Strait of Hormuz effectively closed to container traffic following the escalation between the United States, Israel and Iran, Folk Maritime itself had to redeploy vessels from its India-Gulf route to the Red Sea. According to AIS data, the Folk Jeddah and the Folk Dammam, both 1,900 TEU vessels, left the rotation to Nhava Sheva to focus on Jeddah. Chief executive Poul Hestbaek said the company had no direct operational links with the strait, but that its services along the Arabian Gulf coast had been directly affected by developments in the conflict.
The crisis had immediate repercussions for freight rates and routes. Xeneta found that the spot market to the Gulf, at $1,350 per 40-foot container at the end of February, rose by 54% to $2,070 within two weeks, with some forwarders paying as much as $4,000-5,000 per unit in priority tenders. Over the same period, the congestion rate at Nhava Sheva, which had become a storage hub as well as a transhipment point, rose from 15% to 55%. Maersk activated land bridges from Jeddah to the United Arab Emirates, Bahrain, Kuwait, Qatar and Oman, and from the ports of Fujairah and Khor Fakkan to the Upper Gulf, while Msc introduced surcharges from Nhava Sheva to Antwerp ($2,150) and Valencia ($2,250), as well as an Emergency Fuel Surcharge of $100 per dry TEU and $150 per reefer TEU from Northern Europe to the subcontinent. Cma Cgm and Hapag-Lloyd imposed surcharges of $2,000-4,000 and $1,500-3,500 per container respectively on Bahrain, Iraq, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates.
Further complicating the picture, Nhava Sheva also faced a domestic crisis of its own in the first half of 2026. The prolonged suspension of one of its main Container Freight Stations, ordered after an investigation by the Directorate of Revenue Intelligence (Dri) into a smuggling operation detected by the CFS’s own staff, blocked customs clearance for part of the cargo until the Customs, Excise and Service Tax Appellate Tribunal (Cestat) ordered its reopening on 8 June 2026. At the same time, the introduction of a new truck access management system lengthened waiting times at the gates, with departure delays up 118%, according to data collected in March.
On the Suez front, the recovery remains selective and uneven. January 2026 was the weakest month in the past decade, with 150 container ship transits and a year-on-year decline of 16.7%; by mid-January, weekly transits had fallen to 26, compared with more than 80 before the crisis. Cma Cgm has nevertheless begun a selective return, with its Indamex Karachi-North America service cutting transit time via Suez from 91 to 77 days, while Maersk completed its first unannounced passage in December 2025. In the first half of the Egyptian fiscal year 2025/2026, the Suez Canal Authority recorded an 8.2% increase in transits and an 18.5% rise in revenue compared with the previous year, a figure that mainly reflects the recovery in the central months of 2025 rather than the weakness seen in January.
The situation in the Strait of Hormuz remains unresolved. After the partial reopening announced in mid-June and a fresh suspension of transits at the end of July in response to Israeli raids in Lebanon, Iran and Oman reached an agreement on the coordinates of the new navigation corridor, with vessels heading for the Gulf routed along the northern lane in Iranian territorial waters and outbound vessels using the route closer to the Omani coast. The agreement, initially set to last 60 days and with no tolls planned, is still awaiting approval from Iran’s Supreme National Security Council. Against this still unstable backdrop, global operators continue to show interest in Nhava Sheva’s infrastructure. Stonepeak’s entry into the United Ports joint venture with Cma Cgm, completed on 28 July 2026 for about $10bn, was initially also expected to include a stake in the Indian terminal, but this remains subject to regulatory approvals and has been postponed to the coming months.
M.L.
