Iran war shows who ‘real friends’ are, says Emirati trade minister

• War creates logistics rethink
• Port capacity to increase
• Al Zeyoudi: crisis makes us stronger

The UAE is fundamentally recalibrating its trade strategy in response to the Iran war, capping reliance on any single country for its imports while deepening ties with those the country’s minister of foreign trade calls “real friends”.

The US-Israeli attacks on Iran have forced a wholesale rethink of logistics after the effective closure of the Strait of Hormuz triggered the worst supply shock in global energy history, choking off roughly one-fifth of global oil and gas and disrupting maritime traffic.

“We’re going to continue diversifying, using our own vessels and chains, bringing commodities from other parts of the world and ensuring as well we build up and strengthen our infrastructure in the Northern Emirates,” Dr Thani bin Ahmed Al Zeyoudi told AGBI.

He said the UAE will “continue having more agreements with the rest of the world when it comes to supply chain and trade resilience” and accelerate investment in logistics outside the strait.

The minister said trade figures are set to show record growth despite the Iran war, suggesting the UAE supply chain has been shielded by its alternative corridors and ports.

Al Zeyoudi spoke on the sidelines of a meeting with the UAE India Business Council, a joint business chamber established under the patronage of India’s ministry of external affairs and the UAE’s ministry of foreign affairs and international cooperation, following the 2022 Comprehensive Economic Partnership Agreement (Cepa) between the two nations.

The council said its 15 founding members in the UAE represent some of the largest Emirati and Indian business groups, with combined assets exceeding $1 trillion.

Doubling down

Al Zeyoudi outlined aggressive logistics infrastructure expansion plans as the UAE wants to protect its position as a global trade and re-export hub.

The eastern ports of Fujairah and Sharjah’s Khor Fakkan – which can be accessed from the Indian Ocean without transiting the Strait of Hormuz – are now handling the bulk of the UAE’s seaborne trade in place of Dubai’s Jebel Ali, the country’s main commercial port, where ships have been stranded.

“We’re going to increase the capacity of our ports in Fujairah, Khor Fakkan and even other cities,” he told the business leaders.

“We’re going to have more logistical connectivity to that area.”

Khor Fakkan volumes have jumped roughly 25-fold since the war began, with no clear resolution and repeated flare-ups during the ceasefire.

Bypassing the strait could eventually erode Tehran’s leverage over Gulf shipping routes and potentially boost business for the UAE as companies seek to avoid dealing with Iranian-controlled routes and fees.

Independence

“One of the main lessons here when it comes to the supply chain is that we will not be dependent on any country providing more than 50 percent of any commodity. We’ll make sure that there is a diverse stream and that there are other sources to bring the commodities from,” Al Zeyoudi said.

For businesses currently struggling with securing supplies, the minister said: “We want them to let us know the materials that they need. We’ll be more than happy to intervene with the logistics companies.”

The emphasis comes as DP World launched a war-risk cargo insurance programme in early May, offering up to $400 million per shipment to help businesses maintain supply chain continuity. This came after traditional insurers withdrew coverage and major carriers, including Maersk, MSC and CMA CGM, suspended transits.

“I’ll tell you a secret,” Al Zeyoudi told the room. “Our non-oil trade grew in the last four months. The growth is much better than last year. Yes, it got disturbed in the first two weeks of the war, but we adapted ourselves and we started manoeuvring around this.”

The UAE is connected to more than 400 cities, ports and airports globally, he said, providing the flexibility to reroute supplies.

The country’s non-oil foreign trade exceeded $1 trillion in 2025, up 27 percent from the previous year.

‘Don’t put all your eggs in one basket’

The minister urged businesses to diversify internationally to insulate themselves from disruptions – much like the UAE’s own strategy.

“Otherwise, your businesses are going to die,” he said.

Cross-border trade and investment “is going to cover many of your losses or challenges here locally, and vice versa, because the world is disturbed,” he said. “Geopolitics is everywhere.”

He said the UAE’s strategy is to position itself as a gateway to global markets rather than just a domestic economy of about 10 million people, citing the country’s network of 27 Cepa trade agreements and saying two more were close to being finalised.

“Don’t put all your eggs in one basket,” Al Zeyoudi said. “It’s not only about investments here. We open up your market. We’re covering a population of 3 billion.”

State oil giant Abu Dhabi National Oil Company (Adnoc) is speeding up construction of a second West-East pipeline to Fujairah that will allow it to double crude exports bypassing the strait, with the project scheduled to come online in 2027.

Only real friends

Al Zeyoudi said crises reveal “who is going to back you up and who will be exposed the moment a crisis happens” – a test the UAE will use to reshape its partnerships.

“We’re going to be strengthening our relationships with our real friends,” he said, describing India as one of them.

The UAE is India’s third-largest trading partner and home to more than 4.5 million Indians.

Bilateral non-oil trade between the two countries reached approximately $76 billion last year, growing 17 per cent despite global trade headwinds.

The India-UAE Cepa has accelerated bilateral merchandise trade past the $100 billion milestone five years ahead of schedule.

The two countries upgraded their target to $200 billion by 2030 in January.

Indian Prime Minister Narendra Modi met UAE President Sheikh Mohamed bin Zayed Al Nahyan last week to discuss expanding cooperation during his eighth trip to Abu Dhabi since taking office in 2014, when he became the first Indian prime minister to visit the UAE in 34 years.

“Crisis makes us much stronger and more resilient in coming up with new ideas,” Al Zeyoudi said.

“Sometimes it’s good to shake up the system so you know who you’re really going to depend on.”

Further reading:

• The UAE’s economy in numbers
• GCC and UK to sign free trade deal as negotiations end
• UAE signs off Modi visit with $5bn India investment pledge