International Sanctions on Iran Halt Indian Basmati Rice Exports

09-Jan-2026 05:56 PM

New Delhi. Exports of premium quality basmati rice from India to Iran have once again run into trouble. Indian exporters have stopped shipments as the Iranian government has withdrawn subsidies on the import of food products.

It is understood that consignments of rice worth at least Rs 2,000 crore (20 billion) are currently stuck at international ports, awaiting clearance for shipment to Iran.

The disruption in basmati rice exports is a major blow to producers and processors in top producing states like Punjab, Haryana, and Uttar Pradesh.

Due to international sanctions, the Iranian currency, the rial, has plummeted, and its exchange rate against the US dollar has fallen to an all-time low. Violent protests are taking place in more than 100 cities across all Iranian provinces against the sharp devaluation of the rial, rampant inflation, and unfavorable government policies.

In light of this, the government has ended the subsidized exchange rate facility for the import of food products.

For many years, importers of food products were provided with dollars at a subsidized rate, but with this facility now discontinued, the purchasing power of importers has weakened.

The Vice President of the Punjab Rice Millers Association says that Indian exporters are having to exercise considerable caution in shipping basmati rice to Iran.

Previously, rice and sugar were exported to Iran on a barter basis, and petroleum was imported in return, but this route has also been closed.

Due to US pressure, India stopped importing petroleum from Iran. Despite this, Iran continued to import basmati rice and tea, among other products, from India, but now a serious monetary crisis has arisen there.