The escalation of the Israel-Iran conflict has the potential to seriously affect the export of India’s aromatic, long grain rice basmati, fear exporters.
Iran is one of the largest importers of basmati along with Saudi Arabia, Iraq and the United Arab Emirates. Several ships carrying basmati to Gulf countries are currently in transit, and any disruption in the Strait of Hormuz can “seriously affect the basmati exports from India,” says
Ranjit Singh Jossan, vice president of the Basmati Rice Miller and Exporter Association
India’s maritime regulator—the Directorate General of Shipping—has already asked Indian shippers and maritime stakeholders to remain vigilant while transiting through the Strait of Hormuz, one of the world’s busiest trade routes,
“In view of the same, all Indian-flagged vessels and Indian seafarers calling at ports of Iran and transiting through the Strait of Hormuz are advised to exercise due caution while operating in or navigating through the region,” according to a maritime advisory on Friday.
Jossan says the side-effects of the conflict are being felt in economies, including India’s agricultural exports and the worst affected may be the basmati exports to Iran. “Iran is one of largest and most important buyers, and if the war continues the entire system will be affected, we are really worried,” he added.
“Disruption in this route can delay bulk rice shipments, leading to temporary price increases in Gulf markets while depressing prices in Indian markets. Cargo insurance through the Red Sea and Persian Gulf corridors has already increased by 20%,” says Jossan
Iran has been the largest importer of Indian basmati rice, accounting for about 30–35% in peak years. However, over the past five years, trade has declined due to various reasons, including external sanctions and domestic issues, he adds.
