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Rice & tea shipments to Iran stall on threat of 25% US tariff
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Thursday, 15 January, 2026, 15 : 00 PM [IST]
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Our Bureau, New Delhi
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India’s rice and tea exports to Iran have come to a near-standstill as exporters grapple with payment delays, shipment uncertainties and the looming threat of a 25 percent U.S. tariff on countries continuing trade with Tehran.
The new tariff threat, announced by U.S. President Donald Trump via social media, targets nations doing business with Iran and has sown uncertainty across key export markets. Though formal legal details are not yet available, the announcement is seen as a broad escalation of existing policies aimed at economically isolating Iran amid ongoing domestic unrest.
Rice, particularly Basmati, and tea have historically been significant Indian exports to Iran. Despite previous U.S. sanctions, these commodities continued to flow under waivers for humanitarian goods such as food and medicines. However, exporters say the recent political turmoil in Iran, coupled with fears of additional tariffs, has disrupted payments and stalled new contracts. Communication breakdowns with Iranian buyers and difficulties in coordinating shipments have further compounded the situation.
Trade circles report that as a precautionary measure, many exporters have temporarily halted shipments, awaiting clarity on both the geopolitical situation and the implications of the U.S. tariff threat. The disruption has extended beyond direct trade; transit commerce via strategic hubs such as Bandar Abbas, which serve regional supply routes, has also been affected.
Industry representatives note that India was one of Iran’s largest suppliers of aromatic long-grain rice, with shipments worth hundreds of millions of dollars during the current fiscal period. However, the instability has already begun to weigh on domestic mandi prices for various Basmati varieties, reflecting reduced demand and payment uncertainties.
While Indian officials maintain that current trade complies with existing sanctions, exporters emphasize the need for clearer guidelines on how the new tariff regime might apply to food and agricultural products. In the meantime, many in the sector are reassessing risk, tightening payment mechanisms and exploring alternative markets to mitigate potential fallout from the ongoing standoff.
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