Kolkata: Thanks to its war next door between Iran and the US-Israel combine, Dubai is discovering that the distance between an El Dorado and a zone of damage and scare is not a very long one. What was even a few weeks ago an enclave of peace, prosperity and investment from all over the world has suddenly become a zone of selective destruction which has sent shivers down the spine of investors and businesses. Reports state that the government and businesses are holding emergency meetings on the extent of damage and shock delivered to the city state and to chalk out what measures are needed to support the economy at this hour of crisis.
It has already been reported that real estate prices have plummeted. Businesses are suffering supply chain disruptions which trigger soaring costs. Flights have been mostly paralysed which has done immense harm to tourism and gold business, both of which are booming sectors in the city state. Reports stated that Dubai Chambers, which is an industry association backed by the government, has started taking feedbacks from business owners on supply chain snags, ballooning costs and challenges in operations.
Formidable tourism machine grinds to a near halt
In any crisis like the current one, tourism takes the first hit and Dubai is no exception. The formidable tourism machine which used to bring lakhs to this small area is now grinding to a very slow pace with very few flights operating from the Dubai international airport. Data show that in 2025, Dubai hosted nearly 2 crore international visitors with average hotel occupancy exceeding 80%. In 2025, Dubai International Airport attracted recorded more than 9.5 crore passengers which marked its busiest year.
Reports also indicated that as many as 80,000 bookings stood cancelled in the first week of the conflict beginning Feb 28. Also those already in Dubai on holidays or work-related visits, rushed to get out of the city.
SMEs impacted badly
With flights and shipping services severely impacted, reports have claimed an all-round rise in costs, which has become a rise of 300% in some instances. Predictably, small and medium enterprises have been hit badly. “Overall, businesses remain confident about continuity…Dubai Chambers has initiated dialogue with members to understand the challenges they are facing and what support may be required from the authorities… There is some disruption in the supply chain. Container handling and logistics are facing uncertainties, particularly for building materials linked to ongoing development projects in Dubai, and other key sectors,” Sahitya K Chaturvedi, secretary general, Indian Business & Professional Council (IBPC) Dubai, was quoted in the media as saying.
Gold business impacted
Dubai is a hub for gold business. Gold from Dubai is shipped to various countries in Asia and beyond. But since the precious metal is shipped in the luggage hold of passenger flights, the transport of the yellow metal has been disrupted as flights became scarce following missile and drone attacks on Dubai international airport. As a result, bullion traders have been forced to offer gold at a discount.