TEHRAN – In the midst of the ongoing US-Israeli war of aggression against Iran, the Islamic Republic has begun pivoting its trade flows away from the UAE’s Jebel Ali port toward alternative hubs in Pakistan, India, and Oman. Industry experts say the move deals a significant financial blow to Dubai, which for years profited enormously from re-exporting goods to Iran.

According to Masoud Polmeh, secretary-general of the Iranian Shipping and Related Services Association, wartime disruptions have halted activity entirely at Jebel Ali, long considered the region’s primary trade gateway.

"It is not correct to say that in past years only a port named Jebel Ali has been the origin of commodity and logistics exchanges in trade interactions with Iran," Polmeh said. He noted that Iran has historically maintained logistical links with ports such as Sohar and Salalah in Oman, Karachi in Pakistan, and Nhava Sheva and Mumbai in India.

"Now, under wartime conditions, activities at Jebel Ali port have stopped, and no activity is carried out through this port," he added.

For decades, Dubai served as Iran’s de facto logistical bridge to global markets. Under the cover of legitimate trade, the UAE became Tehran’s primary channel to circumvent international sanctions. Official figures show that non-oil trade between Iran and the UAE reached nearly $30 billion in recent years, with the vast majority consisting of re-exports of Western technology, machinery, consumer goods, and industrial inputs from Dubai into Iran.

Estimates suggest that the UAE earned tens of billions of dollars annually from re-exporting goods to Iran, with Jebel Ali alone handling upwards of 80 percent of Iran’s seaborne imports at its peak. Trading companies in Dubai’s free zones built entire business models around serving the Iranian market, taking advantage of short shipping distances, established banking networks (however fragile under sanctions), and political stability.

Now, with Jebel Ali effectively shut down due to the war and the Strait of Hormuz blockade, that revenue stream has abruptly dried up.

Polmeh emphasized that facilities in Pakistan, in particular, are well-positioned due to their geography and infrastructure to facilitate Iran’s international trade. The ports of Karachi, Port Qasim, and Gwadar—the latter developed under the China-Pakistan Economic Corridor (CPEC)—offer shorter transit times and lower costs for cargo headed to Iran’s eastern and southern provinces.

Shipping officials believe the new corridor could cut transport costs by as much as 45 to 55 percent compared to routing cargo via the UAE, while also reducing travel time from Gwadar to the Iranian border to just a few hours.

Economic analysts describe Iran’s pivot toward Pakistan as a "critical blow" to Dubai’s role as the region’s undisputed re-export capital. Dubai built its "luxury stability" model on offering foreign investors, tourists, and traders a secure hub for business with neighbors. Iran was consistently one of its largest and most reliable clients.

With that client now redirecting its business to Karachi, Gwadar, Sohar, and Mumbai, the long-term damage to Dubai’s trade-related income —including logistics, warehousing, banking, and retail — could be severe. Traders in historic Deira bazaars have already reported sharp drops in footfall and shipments, with conditions reminiscent of the COVID-19 pandemic.

Despite the wartime disruptions, Polmeh stressed that Iran’s own shipping operations remain unaffected. Tehran has diversified its fleet, expanded overland routes through Pakistan and Turkmenistan, and strengthened port infrastructure at Chabahar and Bandar Abbas.

"We have long maintained logistical links with multiple regional ports," Polmeh said. "The difference now is that Jebel Ali is no longer an option — and Iran is adapting successfully."
As the US-Israeli war continues, the temporary closure of Jebel Ali may well become a permanent restructuring of regional trade. For Dubai, the loss of Iranian re-export revenue is a hard blow. For Iran, the pivot to Pakistan and other regional ports represents a strategic victory: proof that the Islamic Republic can bypass economic sieves and keep its economy moving, regardless of who controls the waters of the Persian Gulf.