Exports of premium basmati rice to Iran have once again come under uncertainty, affecting producers and processors in Punjab and Haryana.
The disruption follows a sharp fall in the Iranian currency after the tightening of US sanctions. With the rial touching a new low against the US dollar, the Iranian government has stopped providing subsidies on food imports, prompting Indian exporters to put shipments on hold.
As a result, consignments worth at least ₹2,000 crore are currently stuck at international ports, awaiting clearance for shipment to Iran.
“Due to the sharp depreciation of the Iranian rial against the US dollar, which has reached a record low, the Iranian government has refused to continue subsidies on food imports that were in place for many years. This has made exporters reluctant to carry on trade,” said Punjab Rice Millers Association vice-president Ranjit Singh Jossan, who is also an exporter.
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Earlier, trade between India and Iran was facilitated through a barter system. However, the arrangement ended after India stopped importing oil from Iran. “Despite this, Iran continued to import food products such as tea, basmati rice and medicines from India, but now it appears that these imports are also being curtailed,” Jossan said.
Iran has traditionally been one of the largest buyers of Indian basmati rice, importing around 12 lakh tonnes annually, valued at about ₹12,000 crore. Nearly 40% of this volume was sourced from Punjab and Haryana, the two major producers of aromatic basmati. Prolonged uncertainty in exports has already affected rice millers, and if the situation persists, prices received by farmers are also expected to decline.
{{/usCountry}}Iran has traditionally been one of the largest buyers of Indian basmati rice, importing around 12 lakh tonnes annually, valued at about ₹12,000 crore. Nearly 40% of this volume was sourced from Punjab and Haryana, the two major producers of aromatic basmati. Prolonged uncertainty in exports has already affected rice millers, and if the situation persists, prices received by farmers are also expected to decline.
{{/usCountry}}Before the Iran–Israel conflict, the exchange rate stood at about 90,000 rial to a US dollar. It has since weakened to around 1,50,000 rial per dollar, making imports significantly more expensive for Iran. Earlier, Iran had offered a preferential rate of 28,500 rial per US dollar for food imports, but this facility has now been withdrawn.
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Iran typically halts imports from overseas markets around June 21, when its domestic harvest arrives, and reopens imports in September. During this lean period, Indian exporters usually procure stocks from millers. However, the current uncertainty has disrupted this cycle.
“The prices of the basmati varieties we process have already fallen by ₹3 to ₹4 per kilogram,” said a rice miller. The 1509 and 1718 varieties, known for their long grain and aroma and produced largely in Punjab and Haryana, are particularly popular in the Iranian market.