TIE Staff

Our Bureau, New Delhi

India’s rice exports to Iran are expected to remain resilient despite the threat of tougher US sanctions, with exporters pointing to Iran’s food-security needs and alternative payment channels as key factors supporting continued trade. Rice shipments have continued despite higher prices and months of disruption caused by the conflict in West Asia.

Rice accounted for nearly two-thirds of India’s $1.25 billion exports to Iran in the financial year ended March, while Iran represented around 7% of India’s $11.5 billion global rice exports. Iran imported more than one million tonnes of Indian rice during the last financial year, a 17% increase from the previous year, according to government data cited in reports.

Exporters said the essential nature of rice and limited alternative suppliers could help protect the trade from the impact of sanctions. Iran was also India’s second-largest basmati market by volume during the year, underlining the importance of the country to India’s premium-rice trade.

Indian exporters have increasingly relied on alternative financial channels through countries including the UAE, Germany, China and Turkey rather than directly dealing with Iranian banks. However, the UAE’s recent suspension of trade and financial transactions with Iran has created fresh uncertainty, particularly over payment and shipping routes.

India exported rice worth $383.11 million to Iran in the first half of 2026. Exporters have warned that prolonged disruptions could increase freight, insurance and payment costs, with the basmati industry, particularly millers and exporters in northern India, facing greater exposure.

India’s broader trade with Iran has already fallen sharply from its 2018-19 peak of $17 billion. While food and pharmaceutical shipments may continue under humanitarian considerations, exporters are seeking arrangements that can prevent sanctions-related disruptions from affecting essential trade.

Published Date: August 27, 2026