Death in the skies
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Ironically, the trio and I were on one page on Thursday morning: concern for helpless people in West Asia affected by the war in Gaza, Iran and Israel (with Israel firing the first shots at Tehran).This morning, Aldoris, the choon-paan karaya, came down the lane incessantly playing his tuk-tuk’s signature tune to be greeted with a set of frowning faces. “Aldoris, oya saddey adu-karanna (Aldoris, reduce the sound),” urged Serapina, “Aeih (Why),” he asked, surprised. “Masso wagey minissu marenawa meda peradiga, eth api santhosen innawa. Eka hari nane (People are dying like flies in West Asia and here we are in a happy mood. That’s not right),” said a not-so-amused Kussi Amma Sera.
“Apita kochchara santhosa wenna puluwanda thuwakku nihanda wunoth saha uddeta viyadam wena salli, lokey sanwardanaya karanna saha dugi janathawata sethak wena widihate pavichchi kaloth (How happy would we be if the guns became silent and this costly war was transformed to help develop the world and to serve poor communities),” noted Mabel Rasthiyadu.
That last comment showed the humane qualities of the trio. Probably they have relatives and friends working in war-torn West Asia who would be left wondering whether the war will spill over in the region, now that the US is also considering entering the battle and bombing Iran’s nuclear sites.
As I picked up my mug of tea from the kitchen and listened to the conversation at the gate, the home phone rang. It was Cardboard Sando, the muscle man from the nearby petti-kade. “I say, I am worried about this war as many of my cousins are working in West Asia,” he said.
“There is little information that I can give as tensions are high and anything can happen in the coming days,” I said. “Will the UAE and Saudi Arabia be affected,” he asked. “Again I cannot say as the situation is evolving every hour. Since this morning, there have been attacks and counter-attacks for at least six days between Israel and Iran,” I said.
“Would this war have a major impact on our economy,” he asked. “It will, definitely,” I said.
It would in fact have a major impact on Sri Lanka’s economy, if the war continues.
Unlike the World Wars in the previous century which involved mostly ground offensives supported by air and sea units, today’s conflicts are fought in the skies many, many kilometres away from the two warring nations (Israel and Iran).
For instance ballistic missiles, used in the conflict, can travel distances ranging from a few hundred kilometres to more than 10,000 kilometres across continents. The distance between Iran and Israel is around 1,300 km and missiles fly over countries in between these two warring nations. What if one drops elsewhere? This is the threat facing many countries caught in the middle.
On Tuesday, the Bahrain General Directorate of Civil Defence at the Interior Ministry conducted a test activation of warning sirens. The test was said to be part of precautionary civil protection measures and formed a routine step in reviewing the National Emergency Response Plan. It aimed to assess the operational readiness and effectiveness of the warning systems.
What about the economic impact? Sri Lanka is not immediately affected by the rise in oil prices as the oil stocks available for another 1-2 months are based on previous purchases. The impact would only be if and when a new shipment of oil is purchased in world markets. The government this week allayed fears of a fuel shortage, owing to the conflict, as some residents and motorists were seen flocking to some fuel stations.
The cost of the war will have a significant impact on tea exports, shipping costs and thereby cost of food and other essentials – as ships may have to avoid danger zones and take longer routes – the cost of flights and airfares with airlines taking circuitous routes to avoid the war zones and remittances from migrant workers and their safety. It is speculated that if the conflict persists, airline tickets could rise by 2-5 per cent as planes need more fuel to avoid flying over warring zones – particularly since the fight is in the skies. Already some Sri Lankan workers in Iran and Israel have been affected, while the Sri Lankan mission in Tehran, Iran, has been relocated.
In terms of tea, Sri Lanka’s 10 main tea buyers are Iraq, Libya, Russia, UAE, Turkiye, Iran, Chile, China, Saudi Arabia and Germany and the impact would not only affect shipments but also prices, if there is a delay in shipments.
Sri Lanka’s fuel needs come from India, UAE, Singapore, Malaysia, Russia, South Africa, Saudi Arabia, Oman, China and Iraq.
Migrant workers from Sri Lanka are mainly based in Saudi Arabia, Kuwait, Qatar, UAE, Maldives, Romania, South Korea, Oman, Japan and Jordan.
Last year, Sri Lankan workers sent home a total of US$ 6,575.4 million, a 10.1 per cent increase from 2023, still lower than the highest level of $7.2 billion in 2016. The lowest level in recent years was $3.7 billion in 2022 when the country faced its worst-ever economic crisis.
The www.analyticsinsight.net platform, in an article written by Simran Mishra on June 19, said that tensions between Israel and Iran have erupted into direct conflict, shaking the foundations of global stability. What began as strategic strikes has now escalated into a volatile situation that threatens to ripple through every corner of the world economy. Within days of the first attacks, markets responded with sharp reactions, oil prices surged and trade corridors grew tense with uncertainty.
“This is not just a regional crisis. This is a fault line that could fracture the fragile balance of global trade, energy flows and financial systems. As the conflict lingers, the pressure mounts not only on governments but also on industries and consumers worldwide. The Middle East is a critical energy hub. Brent crude prices soared nearly 7 per cent, breaching $74 per barrel after Israel targeted Iran’s South Pars gas field. Such spikes directly influence fuel costs globally.
“The situation around the Strait of Hormuz poses an additional risk. This narrow passage handles nearly 20 per cent of the world’s oil flow, close to 21 million barrels each day,” the report said, adding: “A shutdown of this chokepoint could significantly reduce the global oil supply. This would force prices higher, sending shockwaves through supply chains and driving costs in almost every energy-reliant sector.”
If the conflict persists, Sri Lanka would be among the worst-hit countries as it depends on remittances, fuel prices, tea markets and unaffected shipping costs. Furthermore, another worry would be if the war suspends migration for work to those countries. The Israel-Iran war has indeed become a costly misadventure, affecting countries like Sri Lanka relying on migrant worker remittances, imported fuel and imported food.
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