Iran halts imports of Indian tea, rice in likely retaliation

Iran has abruptly stopped importing Indian tea and rice in a likely retaliation for India curbing some fruits from Iran, two government officials said. This comes as a surprise as Iran is a top market for both products from India.

“It could be a retaliatory stance against India not taking their kiwis and peaches. This information is mostly coming from the trade channels and not from diplomatic channels; so it could be a trade-related measure. But Iran blocking Indian rice is highly unusual, as Indian rice is much cheaper than rice coming from other countries; so, there is a very strong political undertone to it too,” one of the two officials cited above said on the condition of anonymity.

India stopped importing fresh Iranian Kiwis in December 2021 citing pest-infested consignments.

“Much to our surprise, Iran has stopped taking our tea and rice. We have been exporting tea to Iran for a very long time, and there is huge demand for Indian tea in Iran. We have taken up the Iran issue with the commerce ministry, the tea board, DGFT as well as the Indian embassy in Tehran. The government has said that they are trying to ascertain the reason. And we should be aware of the factual position. The government should take it up with the Iranian government so that we can resume our exports,” Sujit Patra, secretary of the Indian Tea Association said.

Queries sent to the ministries of commerce, external affairs and the Iranian embassy in New Delhi remained unanswered till press time.

“The basic tension between India and Iran is that the latter wants New Delhi to restart buying oil,” said Kabir Taneja, Fellow, Observer Research Foundation.

While Iran’s rice imports in April-September stood at $641.66 million after hitting $855.72 million in FY22, tea imports in the January-September period stood at $66.39 million, second only to UAE.

Earlier, the vostro account set up for India-Iran trade ran dry after India stopped sourcing oil from Iran amid US sanctions.