Context:

• Israel and Hamas have agreed to the initial phase of a ceasefire proposal in Gaza, based on US President Donald Trump’s 20-point peace plan.
• The agreement has sparked optimism about the reopening of the Red Sea shipping route, which has remained disrupted due to Houthi rebel attacks since late 2023.
• The development has broader implications for regional stability and India’s diplomatic positioning in West Asia.

Key Features of the Ceasefire Plan:

• Backed cautiously by the Palestinian Authority (PA), EU, Egypt, Jordan, Qatar, Saudi Arabia, and the UAE, the plan includes -
  • Immediate ceasefire, Israeli withdrawal,
  • Release of hostages and prisoners,
  • Exclusion of Hamas from governance, and
  • Demilitarisation of Gaza.
• Alongside, the plan also includes international reconstruction For example, investment in Gaza’s water, energy, health, and infrastructure sectors.

Israel and Hamas Reactions:

• Israel: PM Benjamin Netanyahu supports the plan reluctantly amid resistance from right-wing coalition partners opposed to Palestinian participation in governance.
• Hamas: Expressed willingness to negotiate but opposes mandatory disarmament, viewing it as compromising Palestinian sovereignty.

India’s Response and Position:

• India termed the plan as a “significant step forward,” reflecting India’s support for peace and reconstruction.
• India may contribute through infrastructure reconstruction owing to its technical expertise and balanced relations with both Israel and the PA.
• India’s official stance since October 7, 2023, remains cautious—condemning terrorism while reiterating support for a two-state solution ensuring both Israel’s security and Palestine’s sovereignty.

Historical Context of India’s Role:

• Early involvement:
  • In 1947, India supported a federal state with Arab and Jewish provinces in the UN Special Committee on Palestine.
  • Recognised Israel (1950) but maintained solidarity with Palestine, providing continuous support to United Nations Relief and Works Agency for Palestine Refugees in the Near East (UNRWA) since 1951.
• Peacekeeping and mediation:
  • India contributed troops to UN Emergency Force I (UNEF I) and UNEF II — peacekeeping operations deployed during and after Arab-Israeli conflicts, with casualties during the Six-Day War (1967).
  • Consistent participation in UN forums and donor conferences on Palestinian rights.
• Diplomatic balancing:
  • Recognised Palestinian state in 1988, among the first non-Arab nations to do so.
  • Established diplomatic relations with Israel in 1992, aligning pragmatically with emerging peace initiatives.

Global Trade and Shipping Dynamics:

• Red sea route and Suez canal significance:
  • The Suez Canal connects the Mediterranean Sea and the Indian Ocean, reducing travel distance between Europe and Asia by over 6,000 km compared to the Cape route.
  • Disruptions due to Houthi attacks severely strained global supply chains, forcing longer routes, higher costs, and delays.
• India’s trade dependence on the Suez canal:
  • Around 90–95% of India’s trade relies on foreign shipping carriers, with the Suez Canal route critical for exports to Europe, Africa, the US, and West Asia.
  • The Cape of Good Hope reroute increased voyage time and costs, reducing the competitiveness of low-margin exports such as agricultural products, textiles and garments, etc.
• India’s overdependence on foreign carriers:
  • India’s outward remittance on transport services already exceeded $100 billion annually even before the Red Sea crisis.
  • Indian exporters accused global carriers of “arm-twisting” during the crisis through inflated freight charges.

Evolving Regional Dynamics:

• India’s engagement now extends beyond the Israel-Palestine binary, encompassing strategic and economic ties with GCC states.
• The Abraham Accords (2020) and India-Middle East-Europe Economic Corridor (IMEC) (2023) have deepened India’s West Asia linkages.
• India’s position is increasingly aligned with GCC perspectives, especially after Israel’s military actions in Gaza and Doha (Qatar) drew global criticism.

India’s Potential Role in Reconstruction:

• India could be invited to assist in Gaza’s reconstruction, leveraging its experience in infrastructure, water management, and energy projects.
• However, recruitment of Indian workers replacing Palestinian labourers in Israel may worsen Palestinian economic exclusion and social resentment.
• India must ensure its involvement contributes to reconciliation, not division.

Way Forward:

• Maintain diplomatic equilibrium: Continue balancing relations with Israel and Palestine, rooted in non-alignment and peaceful resolution principles.
• Conditional engagement: Tie participation in reconstruction to Palestinian sovereignty and compliance with international humanitarian laws.
• Humanitarian leadership: Increase support through UNRWA, medical aid, and peacekeeping contributions.
• Regional cooperation: Work closely with GCC states under the IMEC framework to promote peace-driven economic integration.
• Renewed maritime focus - Government shipbuilding revival plan: The Union Cabinet approved a ₹69,725 crore package to revitalise India’s shipbuilding industry—a strategic response to global disruptions, and a push for self-reliance.
• Support exporters: Introduce freight subsidies or logistics reforms to assist labour-intensive sectors.

Conclusion:

• India’s nuanced stance on the Gaza ceasefire plan reflects its strategic maturity and moral consistency.
• While aligning with global peace efforts, India must ensure that its participation in reconstruction and diplomacy remains anchored in its historical commitment - a durable two-state solution that upholds justice, sovereignty, and regional stability.
• The Israel–Hamas ceasefire brings cautious optimism for global trade recovery and maritime stability.
• The Indian government’s shipbuilding initiative aligns with Atmanirbhar Bharat and enhances India’s role as a key maritime power in the emerging Indo-West Asian trade architecture.