Iran Crisis Puts India’s $1.2-billion Basmati Rice Exports at Risk

Escalating tensions following the Israel–US attack on Iran are expected to impact India’s $1.2-billion basmati rice exports, with exporters expressing concern over trade disruptions in one of their largest overseas markets. Industry representatives said uncertainty surrounding payments, shipping routes and demand from Iran could weigh heavily on outbound shipments in the coming weeks.

Iran is the single largest importer of Indian basmati rice, and exporters noted that Iranian buyers had placed substantial orders over the past two months prior to the outbreak of hostilities. According to Ajay Bhalotia, Director of Fortune Rice Limited and General Secretary of the All India Rice Exporters Association, strong demand from Iran had already pushed domestic basmati prices up by around ₹10 per kilogram in local markets.

However, with geopolitical tensions rising and financial channels potentially affected, exporters fear delays in execution of existing contracts and fresh orders. Industry sources also indicated that tea exports from India to Iran could face similar headwinds if trade logistics and payment mechanisms are disrupted for an extended period.

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Beyond agricultural trade, the conflict has also triggered a spike in global crude oil prices, adding another layer of economic pressure on India, a major energy importer. Trade bodies said the situation remains fluid and that sustained instability in West Asia could have broader implications for India’s export performance and overall economic outlook.

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