Iranian Traders Halt Signing of New Contracts for Buying Tea, Basmati Rice from India
Iran has stopped signing new contracts for importing tea and basmati rice from India since last week, according to a report by the Economic Times.
The report by Economic Times said no clarification has been given by Iranian buyers regarding the sudden halt in buying Indian tea and rice.
Indian traders and exporters believe that the reason for the sudden halt could be due to the ongoing anti-Hijab protests across the country which has led to closure of shops, hotels and restaurants across Iran.
The report by Economic Times said Iranian importers may be delaying purchases because New Delhi and Tehran are working out a rupee trade settlement agreement. The recent developments will impact trade as Iran imports close to 30-35 million kg of orthodox tea and about 1.5 million kg basmati rice from India on a yearly basis.
A tea exporter speaking to the Economic Times said there is no clarity on why the new signing of contracts have been halted and said they are waiting for some clarity from the Tea Board of India.
Basmati rice exports face the same issue but the impact will be lesser as basmati exports have risen on high demand due to high demand caused by the war in Ukraine.
Rice, raw sugar and tea are among the top three items that India exports to Iran. In the last 25 years, exports of India to Iran have increased at an annualised rate of 11.4%, from $149 million in 1995 to $2.24 billion in 2020.
Meanwhile, in the last 25 years, exports of Iran to India have decreased at an annualised rate of 2.35%, from $501 million in 1995 to $277 million in 2020. Iran exports cyclic hydrocarbons, ammonia, acyclic alcohols, nuts, tropical fruits, nuts, apples and pears.
Iranian capital Tehran is witnessing a three-day protest against the morality police and the dress codes imposed on women in the country, sparked by the death of Mahsa Amini, who died at the hands of the morality police after they arrested her for allegedly wearing the hijab improperly.
