Basmati Exports to Iran Halt Amid Conflict; Industry Shifts Focus to India-Managed Chabahar Port
Introduction:
As tensions escalate between Iran and Israel, India’s basmati rice exports to Iran have come to a halt, while shipments to the Middle East have become more expensive. The Indian government is now looking to strengthen connectivity through the India-managed Chabahar Port to safeguard trade routes.
Details:
The ongoing Iran-Israel conflict has started to impact Indian trade, particularly basmati rice exports to Iran, which have completely stopped, according to industry sources. Exporters are now facing higher freight and insurance costs when shipping to West Asian markets, raising concerns across India’s rice export sector.
In response, the Ministry of Commerce recently held a high-level meeting with shipping lines and container associations to assess the unfolding situation. Officials confirmed that the Strait of Hormuz—a critical trade route—is still stable and under close monitoring through a ship reporting system.
However, if the conflict continues beyond June 23, trade movements to Russia, Central Asian nations (CIS), and Afghanistan through Iran’s Bandar Abbas port could also be affected. The Federation of Indian Export Organisations (FIEO) noted that this port remains crucial, especially for accessing landlocked nations like Uzbekistan, which are now cut off from Karachi due to rising regional tensions.
As a long-term solution, exporters and industry leaders are now urging the government to enhance infrastructure and logistics at the Chabahar Port, managed by India. Chabahar provides an alternative route with direct links via Dubai and India’s Kandla Port, reducing dependency on conflict-prone areas.
Additionally, trade dynamics are shifting across the region. Freight charges and transit times have increased for key Red Sea ports like Aqaba, Beirut, and Lattakia, with goods being rerouted to safer ports such as Jeddah and Alexandria. Interestingly, exports to Saudi Arabia are witnessing a rise, driven by demand from the ongoing Neom city megaproject.
With geopolitical uncertainties continuing, the industry is calling for urgent action to improve multi-modal connectivity, diversify trade routes, and minimise the impact of global conflicts on India’s crucial agri-exports. The spotlight is now on Chabahar to serve as a resilient gateway for India’s exports to Central Asia and beyond.