Inquilab News

The economic fallout from the US-Israel conflict with Iran is expected to severely impact the Asia-Pacific region, with estimates suggesting losses of up to $299 billion and millions at risk of falling into poverty. According to a United Nations Development Programme assessment, rising transportation, energy and food costs could shrink regional output by up to 0.8% of GDP, while nearly 9 million people in Asia-Pacific alone face the risk of slipping into poverty.

The crisis has been intensified by disruptions in the Strait of Hormuz, a key global energy route, following military escalation and attempts to restrict maritime traffic. As a major importer of Middle Eastern oil and gas, Asia is particularly vulnerable to supply shortages, with soaring fuel prices already slowing economic growth and straining national budgets. Governments across the region are scrambling to secure alternative energy sources and manage consumption, though such measures are proving costly and limited in scope.

Experts warn that prolonged disruption could also trigger a global food crisis, as supply chains for fertilizers and agricultural inputs many linked to energy markets face severe strain. Rising costs are expected to increase inflation, weaken purchasing power and place additional pressure on households and businesses. International financial institutions have already signaled potential downgrades in global growth forecasts, citing supply disruptions and declining market confidence.

Even if the conflict de-escalates, economists caution that recovery will not be immediate, with long-term damage to infrastructure, trade flows and economic stability likely to persist. The situation highlights the far-reaching global consequences of the conflict, with Asia emerging as one of the most affected regions due to its heavy reliance on imported energy and interconnected supply chains.