NEW DELHI : A sharp fall in the Iranian rial and the withdrawal of food-import subsidies have forced Indian exporters to halt basmati shipments, hitting millers in Punjab and Haryana. The disruption follows a sharp fall in the Iranian currency after the tightening of US sanctions. With the rial touching a new low against the US dollar, the Iranian government has stopped providing subsidies on food imports, prompting Indian exporters to put shipments on hold.

As a result, consignments worth at least ₹2,000 crore are currently stuck at international ports, awaiting clearance for shipment to Iran.

“Due to the sharp depreciation of the Iranian rial against the US dollar, which has reached a record low, the Iranian government has refused to continue subsidies on food imports that were in place for many years. This has made exporters reluctant to carry on trade,” said Punjab Rice Millers Association vice-president Ranjit Singh Jossan, who is also an exporter.

Earlier, trade between India and Iran was facilitated through a barter system. However, the arrangement ended after India stopped importing oil from Iran. “Despite this, Iran continued to import food products such as tea, basmati rice and medicines from India, but now it appears that these imports are also being curtailed,” Jossan said.