Former US President Donald Trump’s latest tirade against Iran—and his threat to impose steep tariffs on countries continuing trade with Tehran—could put India in a difficult strategic and economic position, potentially straining one of New Delhi’s most important trade and maritime partnerships in West Asia.
For the Narendra Modi-led government, Iran is not merely another trading partner. It is a critical stakeholder in regional maritime security and a long-standing bilateral partner across key Indian export sectors, particularly agriculture.
A decade-old maritime partnership
India–Iran maritime cooperation dates back to 2015, when the two sides signed a memorandum of understanding to develop Iran’s Chabahar Port jointly. The relationship deepened in May 2016 with the signing of a trilateral agreement between India, Iran and Afghanistan to establish the International Transport and Transit Corridor, commonly referred to as the Chabahar Agreement.
India played a central role in Phase-1 development of the Shahid Beheshti Terminal at Chabahar Port. By 2018, operations at the port were taken over by India Ports Global Chabahar Free Zone (IPGCFZ), a unit of India Ports Global Limited (IPGL). IPGL itself is a joint venture between Jawaharlal Nehru Port Authority and Deendayal (Kandla) Port Authority, set up under the aegis of the Union Ministry of Ports, Shipping and Waterways.
Given this deep integration, India’s maritime linkage with Iran is not easily reversible. Chabahar remains a strategic gateway for India to access Central Asia and Afghanistan while bypassing Pakistan, making it geopolitically significant well beyond commercial considerations.
Trade ties remain robust
Beyond maritime cooperation, India and Iran continue to share strong trade ties. According to the commerce ministry’s latest trade statistics, India’s merchandise exports to Iran in 2025 exceeded $1 billion, while imports stood at $323 million. The resulting trade surplus in India’s favour was around $695 million for the calendar year.
Agricultural commodities dominate India’s exports to Iran. Cereals—particularly rice—form the backbone of this trade. In 2025 alone, Iran imported $649.4 million worth of Indian rice, while rice exports in FY2024–25 stood at $757 million. Bananas followed as the second-largest export item at $44.8 million, with tea close behind at $43.8 million.
On the import side, India sourced petroleum bitumen worth $110 million from Iran in 2025, along with fresh apples valued at $60.4 million. Imports of khayzur, or wet dates, stood at about $29 million.
Trade volumes have remained largely stable over the past few years. In both 2023 and 2024, India’s exports to Iran hovered around the $1.2 billion mark, underlining the resilience of the relationship despite geopolitical headwinds.
Tariff threat raises concerns
Trump’s latest proposal—to impose a 25 per cent tariff on countries trading with Iran—has raised alarms in New Delhi. The US has already imposed tariffs of up to 50 per cent on certain exports, including a 25 per cent levy linked to India’s purchases of Russian energy.
Any additional tariffs on Indian goods could significantly hurt exporters, particularly in labour-intensive sectors such as textiles, which are already under pressure from earlier US trade measures. For India, the challenge lies in balancing its strategic autonomy and long-standing partnerships against the risk of punitive economic action from Washington.
As geopolitical tensions rise, New Delhi may find itself navigating yet another complex trade-off—between safeguarding its economic interests with Iran and managing the fallout from a renewed hardline US trade stance.
