According to commerce ministry data, in FY22, Iran’s share of India’s exports of basmati rice was valued at $0.81 billion or close to 23% of total shipments valued at $ 3.54 billion.
The civil unrest has caused huge delays in payment settlements and fall in domestic mandi prices of several varieties of aromatic long grain rice.
As a precautionary measure, Indian exporters have temporarily suspended basmati shipments to Iran.
Exporters said the crisis extends beyond direct trade with Iran as transit trade through Iran, particularly via the strategic Bandar Abbas port serving routes to Afghanistan, Turkey, and Russia, has also been severely impacted.
Ongoing unrest has forced the suspension of shipments through the region, further straining global supply chains.
“With the rapidly deteriorating situation in Iran, the Indian basmati rice exporters are facing one of its most serious disruptions in recent years,” Ranjit Singh Jossan, vice president, the basmati rice millers and exporters association, Punjab, told FE..
Singh, also an basmati rice exporter said “for the past five to six days, all channels of communication with Iranian buyers have remained completely shut—be it internet services, mobile networks—making it impossible for exporters to coordinate shipments or receive payment confirmations,”
Volume of rice exports to Iran
Iran has been among the largest importers of the aromatic long-grain rice for several years, along with Saudi Arabia, Iraq and the United Arab Emirates.
According to the latest data, India’s Basmati rice exports to Iran during April-November 2025–26 was at $ 468.10 million, with volumes reaching around 0.6 million tonne (MT).
“Uncertainity looms over India’s basmati rice exports as Iran’s political unrest leaves consignments stuck at ports, payments frozen, impacting prices,” Suraj Agarwal, CEO at Ricevilla Group, said.
Prem Garg, national president, Indian Rice Exporters Federation (IREF), said “the current internal turmoil has disrupted trade channels, slowed payments, and dented buyer confidence. The immediate fallout is evident in Indian mandis, where Basmati prices have softened sharply within days,”
According to a IREF, the domestic mandi price of 1121 variety of basmati rice has declined to Rs 80/kg from Rs 85/kg a week ago, while other aromatic long grain rice variety has declined to Rs 65/kg from Rs 70/kg prevailed a week back.
Garg said that exporters must exercise heightened caution, particularly with respect to credit exposure and shipment timelines. “Importers (in Iran) have conveyed their inability to honour existing commitments and remit payments to India, creating heightened uncertainty for exporters,” he said.
A leading rice exporter from Haryana said “its a complex process to get payments for basmati rice exports to Iran,” Sources said importers in Iran till now were settling payments using traders’ accounts based in Dubai and other channels,”.
The situation has become even more concerning after US President Donald Trump announced a tough stance against countries trading with Iran, imposing a 25% tariff. “This effectively raises the tariff burden on Indian exporters to nearly 75 percent, creating serious anxiety across global markets”, an exporter said.
What does the commerce ministry data suggest?
According to commerce ministry data, in FY22, Iran’s share of India’s exports of basmati rice was valued at $0.81 billion or close to 23% of total shipments valued at $ 3.54 billion.
In FY25, Iran’s share declined to 12% at $ 0.75 billion of the total exports of a record $5.94 billion as payments were delayed because of US sanctions.
Saudi Arabia (20.25%), Iraq (14.3%), Iran (12.67%), United Arab Emirates (6.13%) and Yemen (6.03%) accounted for 60% of India’s total basmati exports in 2024-25.
India has been the world’s biggest rice exporter in the last decade and with a market share of around 35% to 40% in rice trade. India has removed all the restrictions imposed on rice shipment last year.
© Copyright 2025 The SSResource Media.
All rights reserved.